Real Estate Update: A New Market
By Michael Ardolino, Broker-Owner, Realty Connect USA
January/Early February 2017
The landscape is changing, in more ways than one:
- Several major polls have found increased confidence among both consumers and business leaders. Consumer confidence is at a 15-year high. Also, as Newsday recently reported, the LI economy is expected to grow by 1.5%-2.2% this year.
- Increased confidence in the economy spurs increased home sales. 2017 could be the year that brings activity across all market sectors, from starter to luxury. This has been one of the crucial components missing from the recovery up to now.
- Long Island is beginning to lean toward more multi-family housing. “Surban” living, a combination of suburban and urban styles, is attractive to young professionals and empty-nesters. Senior communities, condominiums, and townhouses, boasting less home maintenance and more carefree living, are popping up, often near walkable downtown areas.
- Interest rates have been climbing and are expected to reach 4.5%-5% this year.
(See Exhibit 1) The impetus for buyers is obvious. And sellers, the longer you wait, the higher the rate-and price-you will pay on your next home. Time is of the essence for both camps.
- At the same time, it is important to keep interest rates in perspective. (See Exhibit 2)
Inventory remains low, while demand is going up, especially among millennials and boomers. Buyers are expected to soon be out in force. The savvy seller will take full advantage of this market and list now, not in the spring. Buyers, too, would be well-advised not to wait: There will be a lot of competition out there for the most desirable homes.