When you look back on 2016, the real estate market didn’t show drastic change. That makes most ask the question, what should we expect in the 2017 housing market? More of the same? Or are we in for a big change in the 2017 housing market?
It is probably no secret that rates are increasing and they will probably keep increasing a few times next year. I reached out to Jason Obradovich, EVP of Capital Markets for New American Funding and asked him what he sees happening in the marketplace. He shared good insights for Mortgage Rates, the new President, and the housing inventory
Here is what we can plan on:
2017 Housing Market: Mortgage Rates
Mortgage rates are a pretty hot topic right now. Just do a simple Google search and headlines will probably confuse you.
Freddie Mac: Mortgage rates jump to 2-year high – Housing Wire
You get the point..
Question: In 2017, where do you see mortgage rates going? Even in the next 2-4 months?
On Dec. 14, the FOMC raised the benchmark interest rate by 25bps to the range of 0.50 to 0.75%. The FOMC also forecasted the potential for three interest rate increases in 2017 versus the two they anticipated back in September.
For now, the Fed will continue with the same rhetoric they have for the past several years of maximum employment and 2% inflation. The market will have to wait until 2017 to find out what the upcoming administration will do with fiscal policy, which will also take time to have an effect on jobs and prices.- Jason
No one likes to see things get more expensive. But experts in the industry don’t think these small increases now, will not change someone who really wants to purchase a home. According to the CNN money article, “buyers will pay $21 more per month compared to a year ago, assuming a $241,000 price tag and 20% down payment”
Just like any change in the office, it could mean for changes that we didn’t even consider in early 2016. It also has been a very long time since a real estate deal maker was a US president.
Question: Do you have any comments on future president-elect Donald Trump and his “infrastructure plan?”
I do believe the new administration should focus on keeping jobs in the US and potentially repatriating both money and jobs. That will drive some growth without the expense of existing jobs or deficits. A tax cut is about the most dangerous fiscal policy the new administration could tackle.- Jason
Question: Do you see any change in housing inventory coming in 2017? Or will it be the same problem next year?
There is still a lack of supply of housing to first time home-buyers – Jason
It is impossible to predict the future, as we all know. But it is important to stay updated, informed, and on top of the latest trends. Just because you don’t know the future, does not mean you can’t be prepared.
Reports from around the industry are showing that agents are actually optimistic for a very productive year in 2017. If you want to see this data, you can contact me. I am very excited to see what the 2017 housing market brings. What are your real estate plans this year?