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The Top 6 Real Estate Predictions for 2016
Considering all the ups and downs experienced in the real estate market over the past decade, many people are questioning what to expect for real estate in 2016.
By: Winston Rowe & Associates
The prospects for the real estate market in 2016 look positive, whether you are planning to buy, sell or invest. For everyone that has been standing by and waiting through the economic roller coaster of the past few years to end, the long wait is over and 2016 will be a great year to finally get off the fence and make your move.
Winston Rowe & Associates is a no advance fee advisory and finance firm specializing in commercial real estate bridge funding solutions nationwide. They have prepared this commentary to provide investors with key real estate trends you are expected to see in 2016.
Rising Interest Rates
In December 2015, the Federal Reserve determined the market was strong enough to increase the interest rate by 0.25 percent. The small increase will likely lead to further increases in 2016 with predictions there will be approximately a one percentage point increase between now and the end of the year.
Rising interest rates is not a bad thing, per se. A higher interest rate will increase banks’ willingness to lend money. The increase will mean a stronger dollar, more interest income for retirees, and higher returns for savers.
There are actually some strong benefits to higher interest rates according to www.Bankrate.com. 2016 will be a good time to find financing for a good long term investment property. Acting sooner rather than later will allow you to lock in a lower interest rate before rates climb higher later in the year.
A stable rental market, low rental vacancy rates, and steady demand will keep pushing the price of rental units up in 2016. If you’ve been considering joining the real estate investment market, now is the perfect time to jump in.
Rents have been increasing at a faster pace than home prices. For the majority of Americans, it is cheaper to rent than own. However, for many people, factors prevent them from purchasing a home, including lower credit scores, lack of stable income and not enough savings.
The improved lending market and the desire to get in while interest rates are still low are two main reasons why 2016 will be a great year to consider investing in investment properties. Another point that helps make timing great for an investment purchase in 2016 is the fact that rental costs are expected to skyrocket, which means even more return on your investment.
More Normal Housing Market
www.PwC.com indicates that 2016 will be a good year for real estate. PcW’s interactive tool allows you to look at predictions for over 50 major US cities. On the map, you’ll notice that all major cities are predicted to have fair to good markets in 2016.
www.realtor.com predicts healthy growth in both home sales and home prices, similar to what we saw in 2015, although at a slightly slower pace. 2016 should be much more predictable and stable than past years.
Increasing Home Sales & Prices
Increased equity, an improved economy, and feelings of financial security will lead to more people selling their homes in 2016. www.corelogic.com predicts that home prices will rise at a faster rate than inflation. With home prices predicted to increase by 4 to 5 percent and a lot of new buyers in the market, 2016 will be a great time for home sales.
Affordable New Home Construction
With more buyers in the market (and coming from multiple generations)
Baby Boomers’ Dual Role in the Buying & Selling Markets
In particular, boomers will be drawn to new homes over resale homes in 2016, where they can downsize their home but also customize it to their needs and lifestyle.
Another key demographic in 2016 will be an ideal year for baby boomers to sell their home at a higher price than in years past. After selling, many boomers will look to downsize their new home in order to lock in a lower cost of living for their retirement years.
When experience is important to your real estate success, contact Winston Rowe & Associates, a principal is always available to speak with prospective clients. Their primary objective is to provide the most reliable and efficient means of sourcing both debt and equity funding for your commercial real estate loans. A principal is always ready to speak with prospective clients. They can be contacted at 248-246-2243 or by email at firstname.lastname@example.org (mailto:
If you would like to learn more about Winston Rowe & Associates, check them out online at http://www.winstonrowe.com
Winston Rowe & Associates provides no upfront fee commercial funding solutions in the following states.
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