It’s about that time of year when experts in the various segments of the economy release their predictions for the coming year and Realtor.com’s is getting the lion’s share of the attention. Arguably, the Realtor.com® 2017 National Housing Forecast looks very much like their 2016 predictions, with the exception of some good news for the Madison, WI real estate market.
Expect your buyer to be either a Millennial or a Boomer
The National Association of Realtors (NAR) has been touting their expected onslaught of Millennial homebuyers, despite other, negative economic indicators for this generation. The folks with the money, Baby Boomers, on the other hand, are largely responsible for the housing market recovery in several regions of the country, such as Pennsylvania, Illinois and Florida, among others.
It does stand to reason, however, that Millennials are getting to the age where they’re on the precipice of family-building so buying a home would be near the top of their list of priorities. Add to that the empty nest status of Boomers and the two groups, at least according to realtor.com, will comprise the bulk of the home-buying pool.
The one caveat to this is that interest rates are expect to inch up in 2017, possibly closing off the housing market to a great many members of the younger generation.
But, not the Madison real estate market
Realtor.com’s research claims that of those Millennials that will buy a home in 2017, the majority will choose cities in the Midwest in which to settle, with Madison at the top of the list. Priced out of the markets along the nation’s coasts, it only makes sense that they’d turn their attention to more affordable markets.
Prices will cool off
Realtor.com predicts home prices to slow to a nearly 4 percent growth (compared to nearly 5 percent last year). In other words, prices will still rise, but not as quickly as they did last year. Here in Madison, our year-to-date median sale price is the highest it has been in a decade, so a slow-down may just bring us closer to “normal.”.
It all depends on what happens with the inventory numbers (the number of available homes). If inventories remain tight, as is expected, then prices will naturally keep rising.
Realtor.com places Madison at number 50 on its Top 100 Metros for 2017, with a forecasted 3.75 percent increase in home prices and a 5.4 percent increase in sales.
Photo: By Dori (Own work) CC-BY-SA-3.0, via Wikimedia Commons
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