A ‘good year to purchase,’ experts say
Waiting for a good time to get in on the housing market? Experts forecast that it’s likely to be another banner year in 2020. Mat Ishbia, CEO of United Wholesale Mortgage, told FOX Business there is one big reason this year will be a good one to make a home purchase.
“From a home buyer perspective, affordability is really great,” Ishbia said, forecasting rates will remain low.
According to a report from Realtor.com, mortgage rates are expected to average 3.85 percent.
Consistent with Ishbia’s predictions for continued affordability, Realtor.com expects home prices to rise just 0.8 percent across the U.S. this year – with declines occurring in 25 percent of the 100 largest metro areas.
Ishbia said the spring purchase season in 2020 will likely “have a lot of legs” and could carry on through the fall.
However, challenges are expected to remain for first-time buyers. A lack of inventory at the entry-level section of the market is one negative trend that is expected to carry on into 2020.
“There’s not enough new inventory in the market to support the Millennial generation,” Ishbia said.
The total number of available homes for sale could even hit a record low, with outsized pain at the lower-priced segments, according to Realtor.com
LengingTree also predicts tightened supply at the lower-priced segment of the market will persist this year.
And while Realtor.com expects to see an increase in demand in the entry-level segment – driven by an uptick in Millennial activity – it expects competition to be amplified.
Younger buyers on the hunt for a home might want to consider using a broker to help them lock in better rates, Ishbia said.
LendingTree predicts sales will rise by 2 percent to 5 percent year over year, driven both by low rates and more Millennials entering the market.