It’s hard to deny that 2018 has been somewhat of a strange year for the housing market. In the beginning, home prices were trending upward in a big way, mortgage rates were still at historically low levels, and home sales were quite strong in just about every single housing category.
In recent months, however, home price growth has leveled off a bit for the time being, mortgage rates have now reached their highest level in almost 8 years, and we’ve essentially now shifted towards a buyers’ market.
So what does all this mean for 2019? Well, according to a recent article in Forbes, here’s how things may look for most of next year.
Mortgage Rates Will Still Increase
Although rates are still lower than they were during most of the recession, it still feels like the recent rate increase has had a big impact on market conditions. And in 2019, rates are only projected to keep climbing, perhaps to even 5.8%—a level not seen since 2008.
Millennials Should Still Be Buying
There’s no doubt rising mortgage rates will keep some buyers from making the jump to home ownership. But with the largest group of Millennials turning 29 next year, many will be entering prime home buying age, which should help sales from falling significantly.
Home Sales Are Projected to Drop
Speaking of dropping home sales, the chief economist at Keller Williams is expecting overall home sales to decline by 2%. Much of that decline will be directly related to rising mortgage rates and steady increase in home prices over the last several years.