Find out what trends are coming in 2020.
Last year, 2019 was a great year in Real Estate. Median home prices went up to $316,000—a record high!1 Can we expect the same in 2020? Take a look a the 2020 real estate trends you should know brought to you by our friends at DaveRamsey.com!
#1 Real Estate Trend: Home Prices Are Still Rising Slowly
Okay, let’s start with home prices. Overall, home prices grew slower in 2019 (3.3%) than in 2018 (5%). And this year seems like it will be no different. In fact, real estate gurus predict that home prices will only rise by 2.8% in 2020.2 So, you’ll likely see home prices continue to creep up, but they probably won’t knock your socks off with rapid growth like we’ve seen in previous years.
Real estate gurus predict that home prices will only rise by 2.8% in 2020.
What Higher Prices Mean for Sellers
A nice profit may be on the horizon! But also keep in mind that a lot of buyers are being priced out of the market at the moment, which could lead to fewer offers for your home. So, what should you do about this? Be aware of your competition. With less offers to go around, you want your home to really stand out from similar ones in your area. Prepare your home for potential home buyers and work with a real estate agent to help you list your home at the right price.
What Higher Prices Mean for Buyers
If you’re going to buy a home in this expensive market, you absolutely must find out how much house you can really afford. Crunch the numbers yourself with our free mortgage calculator and figure out a monthly payment your budget can handle.
Commit to staying within that budget amount. Don’t rush into a home purchase that doesn’t make financial sense.
#2 Real Estate Trend: Mortgage Interest Rates Are on the Decline (for Now)
Mortgage interest rates have been going down in 2019—steadily dropping below 4% for common types of loans.3,4 In 2020, economist geeks think interest rates will stay around 3.7% for a 30-year mortgage and 3.2% for a 15-year mortgage (the only type of mortgage we recommend).5
In 2020, economist geeks think interest rates will stay around 3.7% for a 30-year mortgage and 3.2% for a 15-year mortgage (the only type of mortgage we recommend).
What Lower Rates Mean for Sellers
If interest rates stay low, buyers will be more motivated to buy your home sooner than later. But if interest rates do start to increase later in the year, just plan for your house to be on the market a little longer. A mortgage is a big commitment, and adding higher interest rates to the mix will make many buyers pause.
What Lower Rates Mean for Buyers
Even though interest rates are relatively low, if you’re not buying with cash, be smart and go for a conventional 15-year fixed-rate mortgage. That way, you know exactly what your payment will be over the life of the loan.
#3 Real Estate Trend: The Majority of Home Buyers Are Still Millennials
That’s right, our final trend is about who is buying homes. And once again, millennials took the lead as the largest group (37%) of home buyers last year.6
What is a millennial exactly? Well, the nerdy answer is anyone born between 1980 and 1998. The easiest way to spot a millennial home buyer? They can’t wait to post a pic of their new home on Instagram!
Source:
2020 Real Estate Trends: What You Need to Know
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