A Rising Tide for Real Estate Investors in 2016!
The December statistics for housing in Hampton Roads just rolled in, and it does appear we are riding into 2016 on a high tide! With the Great Recession officially in the history books, consumer confidence and positive economic data abound, with experience as our compass. I am excited about the opportunities for Buyers, Sellers, and Investors this year and look forward to helping make some goals come to fruition for my clientele.
In October 2015, the Home Builder Confidence Index reached it's highest point in a decade. Housing starts ended 2015 with the healthiest gains in 8 years, mostly in multi-family complexes. As builders are reviving inventory shortages, we agents are experiencing home buyers at unprecedented levels. Boomerang Buyers who survived foreclosures and short sales are returning to the market as their finances have recovered and credit has improved. An estimated 7 million of these buyers are expected to be back in the market over the next 5 years or more. They will be joining the Millennial Buyers, those born between 1980-2000, who are settling into careers and marriages and making the Home Ownership decision. Millennials were the largest percentage of buyers for the second year in a row in 2015.
In the mortgage industry, we experienced some positive change in 2015. Loan Estimates have replaced Good Faith Estimate, encouraging consumers to have a better understanding of the costs to obtain financing and have a firm number three days before their closing date, eliminating many last minute frustrations and misunderstandings at the time they close on their home. Also, the Fed determined that economic conditions were healthy enough to raise the (Federal Funds) interest rate by a quarter percent in December. Some factors used in the decision include the US unemployment rate steadily below 6%, inflationary indexes, and the health of emerging markets. While unemployment has declined, there has been limited wage growth. The expectation...