10 Housing Market Trends To Watch Now
What emerging trends have the potential to impact the US housing market now? What factors should real estate investors and business owners be watching now?
- The Remodeling Frenzy
Billions were invested in home remodeling last year. More is expected in 2018. That momentum could continue while property prices keep going up, and reality TV shows keep piling on the pressure. This may force some real estate investors to up their game when flipping houses. Though it doesn’t mean every homeowner who remodels will do a good job, complete the job, or make good investments. There could end up being some additional foreclosure inventory due to unpaid liens, title problems due to unpermitted improvements, and some homeowners who wind up in a tight spot after investing in remodeling which doesn’t actually improve the value of their property.
- Remote Work
Amazon is launching a physical store with no real human clerks. It also announced a big virtual hiring spree last year. Remote work is here to stay. This could definitely create a shift to new housing in areas which are more affordable, and which offer strong internet connections. It may also change millions of people’s relationships with housing. They are looking for shorter term commitments (if any commitment at all). They’ll work at home, and won’t need cars to commute.
- Coliving
As a result of the above, coworking spaces, and lack of affordability, we are seeing more coliving spaces popping up. These are mixed use and multifamily, or even single family properties which allow different workers to live in the same space. This could be individual rooms or hostel like spaces. They are smaller and more flexible.
- Vacation Rentals on Major Platforms
If you’ve checked Expedia for a hotel recently there is a good chance that many of the results are now individual apartments, like on Airbnb. Vacation rentals have gone mainstream. This could put the squeeze on amateurs who aren’t so good at real estate marketing. Others may need to up their game, dress their properties better, work hard on their reviews, and build in the cost of giving up fees or commissions to platforms like Expedia and Booking.com.
- Bitcoins
You can already rent a vacation home on Expedia with bitcoins. Some home listings are already being advertised in bitcoins. The recent crash in bitcoin price could convince even more cryptocurrency users to cash out more of their holdings, and put it into solid assets like real estate.
The Home Equity Loan Boom
2018 is expected to bring a new home equity loan boom. This will inject a lot more money into the economy. Some will go into investing in real estate. Some lenders may find their first position mortgage loans are now followed by sizable lines of credit. Investors should be encouraging homeowners to use these funds wisely, but shouldn’t miss the opportunity it brings.
Value Investing
We are more flush today than in a long time. That means not having to work or invest just for the money. We can choose on a broader set of criteria. At the same time we have a whole new level of understanding of the dangers and extreme costs of bad business. As well as being able to more easily connect with like-minded people online. In turn this means more individuals can and want to invest in line with their values. They can choose niches and businesses who share the same passions and ethics.
Boomers Downsizing
Boomers are hit senior age in incredible numbers. They are retiring and no longer need to be near old jobs. Have old homes that are too much work to maintain. They want to move to their dream destinations, or need to move closer to healthcare and must have more affordable living arrangements.
Millennials are Maturing
Recent data and surveys show that contrary to a lot of hype in the news; millennials are maturing to the stage where they want more space. They want single family homes, in the suburbs, with outdoor space, and space for their pets.
Enter Generation Z
While many online publications and Realtors are consumed with thinking about millennials, Generation Z is already graduating to living by themselves as well. The front runners of this next generation are looking for student housing, their first apartments and starter homes, and opportunities to work, invest, and make money. Don’t overlook them.