There is a rebound in the housing market and this rebound is heading onto 2016. With this rebound comes new trends such changing pitches and attracting young buyers.
Nearly everywhere you turn, you hear news of the rebounding housing market. Not only is it bouncing back, but it’s also making a huge comeback with new owners and investors getting into the market.
Pushing great deals
With more quality inventory available, 2016 will continue to be a buyer’s market. This means that agents will be getting creative with how they pitch the best deals.
The rise in single-family home median sales has been on a rising trend since mid-2012 and is expected to continue well into 2016. Couple this with a decreasing trend in the number of distressed sales, and what we will have is a large, high-quality inventory full of great deals for new or experienced buyers.
For agents to be successful in 2016, they’ll need to understand the buyers they’re working with. When it comes to great deals, one size might not always fit all.
Attracting younger buyers
Say what you will about the younger generation, but they’re proving to be more financially savvy than previously anticipated. According to a report from realtor.org, “Gen Y comprises the largest share of home buyers at 32 percent, which is larger than all baby boomers combined.”
Also, “Gen Y has the largest share of first-time buyers at 68 percent,” and “Gen Y buyers primarily purchased a home just for the desire to own a home of their own.”
Indeed there are great hopes for the real estate industry. 2016 will see a return to normal even though it will be slower. Builders are expected to give more affordable price points.
We’ll return to normal (Anyone remember normal?)
The year ahead will see healthy growth in home sales and prices, but at a slower pace than in 2015. This slowdown is not an indication of a problem—it’s just a return to normalcy. We’ve lived through 15 years of truly abnormal trends, and after working off the devastating effects of the housing bust, we’re finally seeing signs of more normal conditions. Distress sales will no longer be playing an outsized role, new construction is returning to more traditional levels, and prices rise at more normal rates consistent with a more balanced market.
Builders will focus on more affordable price points
One aspect of housing that has not recovered yet has been single-family construction. Facing higher land costs, limited labor, and worries about depth of demand in the entry-level market, builders have shifted to producing more higher-priced housing units for a reliable pool of customers. That focus caused new-home prices to rise much faster than existing-home prices. Builders were able to be profitable and grow by following this move-up and luxury strategy, but their growth potential was limited by avoiding the entry level. That should begin to change in 2016.