2017 Houston Housing Market Forecast
Is buying or selling a home on your list of resolutions for the new year? Take a look at our Houston real estate forecast for 2017 to help you decide on the right time to enter the market.
Interest rates on the rise
Mortgage rates in Houston were already expected to increase in 2017 before the Federal Reserves’ announcement about raising short-term interest rates. What kind of impact will this news have on the local housing market?
Chances are it may lead to a slight decrease in home sales, but should have less of an effect than other factors like home prices and job availability. Being home to three major industries – energy, manufacturing, and healthcare is expected to help job growth in Houston keep improving in 2017 which will attract more buyers to the city.
Home prices will continue to rise
Home prices in Houston are up, but how long will that trend last? The average home value in the greater Houston area rose 7.5 percent this year, which is higher than the national rate. The current prediction is that home prices will continue to rise in 2017 but at a slower rate. Experts are predicting that the market will favor sellers in 2017, but will shift towards buyers in 2018.
If you’ve been on the fence about selling your home, all signs point to now being a perfect time. Although the market isn’t expected to shift until early 2018, many buyers will be aware of that fact in the final months of 2017.
More Millennial Buyers
The millennial generation has been famously slow to enter the housing market as buyers. Having come of age during the recession, many millennials have a negative view of homeownership and the financial hardship a faulty mortgage can lead to.
However, it appears that this sense of caution is beginning to fade. As millennials start building families of their own, the need to purchase a home is more prevalent. Many market experts are predicting that 2017 will be the first year that millennials make up the majority of home buyers.
For sellers, this presents a new challenge of making sure your home appeals to both the boomer and millennial buyer.
Distressed home sales continue to lag
The overall outlook for the Houston housing market looks good for 2017, but one area that will continue to lag is distressed home sales.
Distressed homes are houses that are not quite move-in ready. This could mean a house in need of serious repairs or one that requires certain updates to make it comparable to other houses available. Aside from the repairs, the biggest issue with buying a distressed home is coming up with the financing. Most lenders do not want to assume the risk of a possible foreclosure on a distressed home and will require certain repairs be completed before closing.
One workaround to this issue is to work with a home investor like We Buy Ugly Houses Houston. We buy home as-is and pay cash which avoids the issue with the lender. Get a free cash quote from us today to see if we can help you get your home sold.