SANTA CLARA, Calif.,
April 23, 2019 /PRNewswire/ --
Realtor.com®, the Home of Home Search℠, today released a
revised 2019 housing forecast, which shows the outlook for the real
estate market this year is somewhat stronger than originally
forecasted. Based on a shift in the economic outlook and slower
pace of monetary tightening, the online real estate destination is
now expecting lower mortgage rates of 4.5 percent by the end of the
year, higher home price growth of near 3 percent and stronger homes
sales.
|
2019 Mortgage
Rates
|
2019 Home
Prices
|
2019 Home
Sales
|
Updated 2019
Forecast
|
4.5%
|
+2.9%
|
-0.3%
|
Original 2019
Forecast
|
5.5%
|
+2.2%
|
-2.0%
|
"The 2019 housing market is different than what we predicted in
fall 2018, primarily due to an unexpected drop in mortgage rates in
January 2019," said Danielle Hale, realtor.com®'s chief
economist. "We believe 2019 will be characterized by lower, but
still increasing mortgage rates that will buoy home prices and
sales by boosting buyers' purchasing power beyond what we initially
projected. This will create a slightly hotter, but still cooling
housing market relative to the initial forecast five months
ago."
Mortgage rates will end the year lower than originally
expected
At the end of 2018, mortgage rates
approached 5 percent and this upward momentum was anticipated to
continue well into 2019 due to continued economic growth and
monetary policy tightening. However, after an unfavorable reaction
to the December rate hike, the Fed pledged "patience" ahead of
future monetary policy moves.
The change in economic outlook paired with a pledge of patience
has brought long term rates down to just over 4 percent, levels
last seen in January 2018.
Realtor.com® now expects rates to begin drifting upward
as data suggests continued economic growth. Due to their lower 2019
starting point, mortgage rates are expected to approach 4.5 percent
by the end of the year -- nearly a percentage point lower than
originally expected.
2019 home prices forecasted to be higher than
expected
Falling mortgage rates have given home buyers more
purchasing power to balance rising home prices, but that in turn is
allowing for more home price growth than was expected in November.
As a result, realtor.com® now anticipates home prices in
2019 to be 2.9 percent higher than in 2018 -- a 0.7 percent
increase over its original prediction.
Although home prices are currently growing at 3.5 to 4.0 percent
year-over-year, the rate of growth is far slower than the past few
years of 5 to 7 percent growth, indicating prices are
softening.
Home sales will fare better than originally
predicted
After a 10-year high in 2017, home sales
slipped in 2018 and are on track to end 2019 with 5.3 million homes
sold, essentially flat with 2018. Initially,
realtor.com® projected home sales to slip 2 percent
further in 2019, but the combination of lower mortgages rates and
an influx of inventory have spurred sales.
About realtor.com®
Realtor.com®, The Home of Home Search℠, offers an
extensive inventory of for-sale and rental listings, and access to
information, tools and professional expertise that help people move
confidently through every step of their home journey. It pioneered
the world of digital real estate 20 years ago, and today is the
trusted resource for home buyers, sellers and dreamers by making
all things home simple, efficient and enjoyable.
Realtor.com® is operated by News Corp [Nasdaq: NWS,
NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. under a perpetual
license from the National Association of REALTORS®. For
more information, visit realtor.com®.
Contact: Janice
McDill, janice.mcdill@move.com
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SOURCE realtor.com