4 Real Estate Trends to Watch in 2018


As 2018 quickly approaches, new trends are beginning to emerge that will shape the real estate market for the upcoming year. In order to help real estate professionals and homebuyers succeed in the New Year, realtor.com’s data team combed through countless reports and analytics to help forecast the top real estate trends for 2018. Here is what they found:

Supply Meeting Demand

For prospective homebuyers frustrated in their quest to find a home that meets both their needs and their budget, help may be on the way. The Realtor.com economics team predicts that the housing shortfall should ease up in the latter half of 2018. New construction is expected to pick up– adding inventory and easing pressure on the for-sale housing market. Thus providing homebuyers with more housing options, which may also result in lower home prices.

Millennials Entering the Housing Market

Although millennial homebuyers will still be burdened by their student debt, there is a light at the end of the tunnel. As they progress in their careers, their income is starting to grow which allows them to qualify for larger mortgages and compete in more competitive housing markets.

Millennials are reaching the point in their lives where they are starting to settle down and start families– motivating them to make the financial leap of purchasing a home. The Realtor.com data team predicts that, “Millennials could make up 43% of homebuyers taking out a mortgage by the end of 2018, up from an estimated 40% in 2017, based on mortgage originations. That 3% uptick could translate into hundreds of thousands of additional new homes. As inventory starts to rebound in late 2018 and in years to come, first-time homebuyers will likely make up an even larger share of the market.”

Regional Growth

Southern homes are expected to see a 6 percent growth or more in 2018, compared to the expected 2.5 percent nationally for home sales. Low costs of real estate and living expenses have motivated many corporations and individuals to move south. Most notably accelerating a boom in homeownership in Tulsa, OK; Little Rock, AR; Dallas and Charlotte, NC.

Proposed Tax Reform

Tax reform could affect 2018 home sales, but how the real estate market will directly be affected depends on the details of the plan that is ultimately adopted. According to realtor.com, both the U.S. House and Senate tax bill, “include provisions that are likely to decrease incentives for mobility and reduce ownership tax benefits.” On the other hand, some taxpayers (including renters) may see new tax cuts. Although more disposable income for prospective buyers is positive for the housing market, the long-term effect of losing tax benefits for homeowners could result in fewer sales and impact home prices over time.

Are you considering purchasing a home in 2018? Contact a trusted loan advisor today to discuss your options to meet your financial goals.

By Kendall Taylor