Last year, the recovery of the housing market in Greater Lansing continued with volume and prices rising in most areas for the fourth consecutive year. The rise has been steady, but not spectacular, like many coastal markets. But with mortgage interest rates rising this year, can we expect the market to cool in 2019? Let’s take a look at some projections and housing market predictions for 2019 in Greater Lansing.
What to Expect from the Housing Market in 2019
For the Greater Lansing housing market to continue its upward swing in 2019, a few factors have to be in place. So, what are the ingredients needed for a solid housing market? Does Greater Lansing have them? And does this mean it’s time to plan your home sale or purchase this year?
Consumer Confidence is Up
The first is positive overall consumer sentiment. The National Association of Realtors tells us that over 8 in 10 adults see home ownership as a part of the American Dream and 86% of adults whether Millennial, GenXer, or Boomer see buying a home is a good financial decision.
Home buyers across these different generations will be looking for different things in their home, which is good news for well-rounded competition and new home construction. Many Millennials are looking for the first home, and weighing their options when it comes to buying or renting. GenXers are most likely looking to move up into a larger home, either to accommodate their growing family or to fulfill their dreams. Many Boomers are looking to downsize, or sell their home in Greater Lansing to move to a warmer region. All of these groups together help to form a balanced home buying cycle.
The Local Economy is Strong
The second and critically important ingredient for a strong housing market is the economy. The Lansing area has continually added jobs since 2011, and unemployment has continued to drop. The Lansing area economy is very balanced, with a growing manufacturing sector, thriving health care providers, solid insurance company headquarters, and a growing tech sector. Job growth has contributed to a steady population growth over the past few years.
Mortgage Financing is Available
Another factor contributing to a strong housing market is readily available mortgage financing at affordable rates. Although most industry pundits expect interest rates to drift upward, ending the year above 5%, borrowers can still finance at historically low rates with down payments as little as 5% even for first time buyers. This is good news particularly for Millennials, who are now the largest home buying segment of the population.
Home Ownership is Still Affordable
A final factor in a positive housing market is affordability. Though average selling prices have risen consistently, housing in our market remains affordable. This means the median priced home in the area can be purchased by the median income family. The low cost of living is part of what makes Lansing one of the best places to live in Michigan, which further helps home buyers stay ahead of their payments and purchase their dream home.
Housing Market Predictions for 2019
So, what are our housing market predictions for 2019 in Greater Lansing?
- A positive economic outlook will continue.
- Home prices will continue to rise in the 5% range, still above the historical rate of 3.8%
- Inventory of saleable listings will increase, but not enough to quite balance the market.
- The seller’s market will continue, but sellers will have to adjust to a new reality where multiple offers are not common and days on market grow.
- Demand for new homes will exceed home builders’ ability to handle the demand
Our housing market predictions for 2019 in Greater Lansing look bright. All the ingredients are in place for continued upward trends in 2019, though neither buyers nor sellers should expect a mirror image of 2018.
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