It’s been nearly a decade since the Great Recession delivered the worst housing crash in modern memory. But these days, the fallout feels squarely in the rearview mirror. Markets have bounced back with fervor, and confidence is skyrocketing. From Charlotte, North Carolina, to Stockton, California—and everywhere in between—homes are flying off the market at record prices, and buyers are still clamoring to get in the game.
1. Rates are still historically low, drawing buyers into the market
We may not be enjoying the rock-bottom interest rates of yore, but by historical standards, today’s 30-year mortgage rates—hovering just above 4%—are still low. And experts agree mortgage credit will remain relatively cheap for most of the year. Roughly translated, that means you’d be wise to list your home earlier in the year, before more rate hikes kick in.
2. Inventory remains tight—and demand high
Simply put, there are more buyers than available homes—particularly in red-hot markets where land is scarce and it isn’t cheap to build. “We’re in a very favorable seller’s market,” she says. “We’re seeing bidding wars—which push up prices—and buyers are submitting offers with very pro-seller terms, like foregoing the repair request or waiving the appraisal contingency.”
3. Home prices are still increasing
From coast to coast, home prices continue to rise—which translates to more money in your pocket when you sell. But the gains are predicted to be more moderate than in years past. Realtor.com data suggest a 3.2% increase year over year, after finishing 2017 with a 5.5% year-over-year increase.
4. People have more money in their pocket
Record levels of consumer confidence, low unemployment and stock market surges are setting the stage for high home buyer turnout in 2018. For the first time since the 1960s, the Fed has projected that the unemployment rate will drop below 4%, and the domestic stock market is enjoying a nearly unprecedented rally.
“Incomes are growing and people are finding better and more stable jobs,” Vivas says. Buyers “are feeling pretty good about (their) finances.”
5. Millennials are ready to commit
Millennials, often crippled by student debt, have been especially hampered by rising interest rates and high home prices, but the aforementioned conditions are ripe in 2018 for these first-time buyers to take the plunge, and experts predict that millennials will make up a vital part of the buyer pool over the coming year. Millennials could account for 43% of home buyers taking out a mortgage in 2018 (a 3% year-over-year increase), according to Realtor.com data.