As we enter the last month of the year, you may be wondering what state the housing market is in and where it’s headed. The answer is simple: look to the economic principle of supply and demand.
Housing inventory is low, which means prices are trending upwards. A scarce supply equals higher demand, which drives up sale prices. Consumers are willing to pay more for what they want—and considering interest rates are currently at an all-time low, they want to buy as soon as possible. This lack of inventory and desire to buy now is also leading home seekers to engage in bidding wars, which is another factor driving up price points.
As a result of the present-day market landscape, experts from Zillow, Zelman, NAR, Freddie Mac, and others project that buyer interest will increase and home prices will continue to appreciate up to 7% over the next 12 months.
While some worry that the current economic climate will lead to an onslaught of foreclosures and drive prices down, housing expert Ivy Zelman, CEO of Zelman & Associates, said last week “The likelihood of us having a foreclosure crisis again is about zero percent.” So rest easy—whether you are thinking of buying or selling your home, the market is projected to hold steady for the next year.