1. How will a Trump presidency affect the housing market?
One question I’ve been getting a lot: “How will a Trump presidency affect the housing market?” For starters, one of Trump’s first actions in office was to suspend a .25% reduction in FHA mortgage premium rates. A reduction in premiums would have made getting a loan more affordable for some borrowers, but suspending the rate cut will likely have a relatively insignificant effect on the market as a whole.
Additionally, according to the National Association of Homebuilders, 30% of the labor force in the home building industry consists of immigrants. If the Trump Administration were to build a wall on our southern border, begin deporting illegal immigrants, or roll out more travel bans, homebuilders could be affected. A reduction in labor would mean less new homes on the market and fuel an already historically low inventory.
2. What will the market do in 2017?
Another question I’ve been asked: “What’s in store for 2017?” Well, no one has a crystal ball, but many experts are predicting another year of strong gains in home prices, but perhaps at a slightly more moderate pace: somewhere between 5-9%. As our local economy booms, the Denver Metro population is expected to increase by over 50,000 in 2017. Inventory will remain low (~6 weeks currently) and all indications are that interest rates will rise steadily through the year.
3. What does this mean for me as a buyer or seller?
What this does this mean for you? Well if you want to buy this year, try to buy when the demand decreases seasonally. During the spring frenzy, it’s not uncommon for a home to be on the market for just a few days and sell for $10,000 or more over asking price. Also, start doing your homework. Begin researching how much money you'll need to buy a house and the first steps of home buying.
If you want to sell, you could be in a great position to reap the rewards of a strong seller’s market. Just avoid over pricing your house and be willing to make the necessary updates your home would need to sell. After 4 years of rising home prices, many homeowners have seen the market value of their home grow substantially.
If you have questions about buying, or you're curious about your home’s value and you’d like a free evaluation, just let me know. I’d be happy to help!