Keep an eye out for these residential real estate trends to make the best investment decision!
If you’ve been a part of the real estate investing game, you’d know that studying the state of the housing market before making any investment decision is key. The housing market is like a roller coaster that goes up and down. Staying in the loop of the different residential real estate trends is a habit you must adopt in order to become a successful real estate investor. This assures that you’re making smart investment decisions and are prepared for what’s to come in the future. This blog covers the top 5 residential real estate trends to watch for in 2018. Thus, if you’re searching for your next property investment or thinking of buying your first investment property in the US housing market, keep on reading.
Residential Real Estate Trends: Supply and Demand
Earlier this year, real estate buyers had a hard time finding properties for sale due to the shortage in supply. Despite the new housing construction, low inventory is still an on-going trend as the current supply of homes for sale isn’t keeping up with the high demand, making the US a seller’s market. This is good news for homeowners as they’ll gain much more leverage if they decide to sell their properties.
As a homebuyer, on the other hand, this brings about some challenges. You’ll have to compete with others interested in the same property. You’re also likely to end up in a bidding war, and won’t have room for negotiations with the seller. As you can see, it’s tough being a buyer in a seller’s market. Regardless, don’t let this stop you from investing in real estate!
Residential Real Estate Trends: Property Prices
The demand for housing is increasing in the US real estate market in 2018. The main reasons for this are the growing economy, strong job market, and millennials entering their home buying years. Millennials are, in fact, driving and changing the real estate investing industry. These residential real estate trends have led to another one – property prices climbing up! Basically, a lot of people want to buy homes but can’t really afford to do so. As a result, first-time property investors re-consider their financing options for buying investment properties.
If this information didn’t discourage you from buying, you’ll be happy to hear that there is a tool which allows you to find affordable properties – the Heat Map Tool. Using Mashvisor’s heat map, a real estate investor can search for properties in different areas in his/her city based on their listing price (as seen in the picture below). With the help of visual cues, you can easily find where the most affordable investment properties are located!
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.
Residential Real Estate Trends: Mortgage Rates
If you’ve been keeping an eye on mortgage rates since the beginning of the year, you’d know that they’re rising. For much of 2017, the average 30-year fixed mortgage rate hovered below 4%. At the start of the year, it began to climb steadily. As of June 2018, the rate of a 30-year fixed mortgage is 4.57%, according to Freddie Mac. Furthermore, The Mortgage Bankers Association (MBA) predicts that this rate will keep on rising and will hit 5% by the end of this year and beginning of 2019!
Based on these residential real estate trends, we recommend property investors not to wait any longer. With property prices and mortgage rates both going up, it’ll be harder to enter the real estate investing business. Thus, if you believe you’ve found a good investment property for sale, don’t hesitate to put an offer as now is the best time to buy before affordability is further reduced.
Residential Real Estate Trends: Emerging Technologies
There’s no doubt that today’s advanced technology has affected all aspects of life, including the housing market. Today, homebuyers search online to find their future homes. Likewise, there are many websites (like Zillow for example) that operate for the purpose of offering property investors the tools they need to find the best and most profitable investment properties. Mashvisor is also one of those.
At Mashvisor, we provide you with a number of investment tools, one of which is already mentioned above (the Heat Map Tool). Another tool we believe every real estate investor needs to succeed in the business is the Investment Property Calculator. This tool gives you data and analytics (traditional and predictive) to analyze the potential profits of a rental property before buying it.
If you’re not too keen on analyzing, then you’ll definitely need the Property Finder Tool. This tool does all the calculations for you and, as the name suggests, finds the best properties that match your search criteria. With the help of these tools, today’s property investors turn their search from 3 months to 15 minutes!
Mashvisor also works to benefit real estate agents as well! Through our lead generation system and free agent profiles, we connect agents with quality leads to help them reach potential clients who are interested in real estate investing. Are you a real estate agent? Click here to claim your free real estate agent profile at Mashvisor!
Residential Real Estate Trends: Buying vs Renting
Based on our previous points on supply, affordability, and mortgage rates, it’s only reasonable that most people in the US housing market rent rather than own their residence. People WANT to buy, but this option doesn’t seem realistic for first-time homebuyers – especially millennials who are dealing with students loans and starting their careers. Rental demand is high among this demographic group, so if you’re a real estate investor depending on rental income, this is good news for you.
Rental rates are increasing in some parts of the country where the population is growing, people are seeking job opportunities, and homes are too expensive. Buying a rental property in such cities is a smart investment decision as you’ll be able to make and enjoy an attractive rental income. Do you have a free Mashvisor account? Click here to use our Property Finder and find the best rental property in your city/cities of choice in a matter of minutes!
The Bottom Line
There you have it – these are the top 5 residential real estate trends affecting the US housing market in 2018. Assuming that no significant change occurs to change those trends, property investors can expect a seller’s market in the upcoming year. What do these trends mean to you as a residential real estate investor? Will you consider selling your rental property? Or will you hold it for a few more years and enjoy the rental income? Let us know in the comments below!
If you’re looking to buy, on the other hand, don’t forget to sign up with our services and use the best investment tools to find profitable properties in your city. To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.