After, more than 15 years, as a Real Estate Licensed Salesperson, in the State of New York, I have witnessed, a variety of different, so – called, real estate markets, including: Sellers Market; Buyers Market; and neutral/ balanced ones. I’ve seen high, mortgage interest rates, low ones, and it seems, everything, in – between. The rules, of, Supply and Demand, have, dramatically, fluctuated, from time – to – time! In recent times, a combination of factors, especially, since the onset of this horrific pandemic, have included: record/ historic – low – interest rates; limited inventory of houses, for – sale, and changing priorities, of potential, qualified buyers (in terms of location, style, size, priorities/ perceptions, etc). However, the reality, is, at some point, the market, will probably, change, again, and, with that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, 6 probable, intermediate – term, changing, real estate trends.
1. Gradually, rising, mortgage interest rates: These record – low, rates, will, eventually, move up. This will, probably, occur, gradually, based on overall interest rates, which are largely, determined, by the policies, and actions, of the Federal Reserve Bank. Extremely, low rates, make buying houses, more desirable, because, since most, rely on a mortgage, it means, they can afford, higher prices, etc. The present, low – rates, are, largely, due to perceived weaknesses, in the overall economy. If, and, when, the overall, economic conditions, seem to improve, and/ or, there are enhanced, inflationary trends, and stresses, rising rates, most likely, will follow!
2. Return to a more, balanced market: We’ll probably, witness, more balance, between, the number of buyers, and sellers, in the intermediate – future. This will probably, take some time, because, we are living through, strange, and unpredictable times! If/ when, more homeowners, decide to sell their houses, the change, will begin!
3. Changing, desirable trends, and priorities: At present, because of the impacts, and ramifications, of this pandemic, and, the associated, public – health – oriented restrictions, many buyers, seem to be leaving the city, seeking a less – dense, set of conditions! Some priorities, seem, to include: more interior space; different interior features/ priorities; sufficient land, to be comfortable; and other conveniences, etc.
4. Energy/ Heating sources: Many seek more sustainable sources of energy, to meet their heating, and electric utility. needs. We can probably expect, a greater use, of solar panels, geo – thermal, and more energy efficiency, etc.
5. Changing tax considerations: When, the 2017 tax reform legislation, was enacted, it included, SALT restrictions, which capped, the ability to deduct, state and local taxes, from federal income tax returns. This may, at some point, reduce the attractiveness of houses, in certain higher – tax, areas.
6. Different model for real estate taxes: Certain localities have significantly, higher, real estate taxes, than others! At some point, this may, negatively, impact, how desirable, owning a house, may be, in some regions.
Since, for most, the value of their house, represents, their single – largest, asset, doesn’t it make sense, to pay keen attention to, anything, which might impact home value. Will you be a prepared, more – knowledgable, homeowner/ home – buyer?
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