Happy New Year! Those who closely follow the real estate market are watching and wondering what changes 2018 will bring. The reports we are seeing bode well for both homebuyers and sellers.

According to the realtor.com® 2018 National Housing Forecast, the easing of inventory shortages is expected to result in more manageable increases in home prices and a modest acceleration of home sales. The annual forecast also expects an increase in millennial mortgage share. Some of the trends they identified include:

  1. Inventory is expected to increase. Realtor.com® projects U.S. year-over-year inventory growth to tick up into positive territory by fall 2018. The majority of growth is expected in the mid-tier price points, which includes U.S. homes priced above $350,000. Recovery for starter homes is expected to take longer because their levels were significantly depleted by first time buyers.
  2. Slowing price appreciation expected. Realtor.com® reports home prices are forecasted to slow to 3.2 percent growth year-over-year nationally. Most of the slowing will be felt in the higher-priced segments, so expect that sellers will need to price competitively. Entry-level homes will continue to see price gains due to the larger number of buyers that can afford them.
  3. Millennials gain most market share. “Millennials are on track to gain mortgage market share in all price points, due to the sheer size of the generation,” according to the forecast. Millennials could reach 43 percent of home buyers taking out a mortgage by the end of 2018. Expect Millennials to start competing for higher priced homes.
  4. New tax reform laws. The laws will affect taxpayers in different ways so consumers are encouraged to consult with their tax advisors. The National Association of Realtors® also provides the latest news and forecasts on how tax reform will impact consumers.


To see more trends and what you can expect in 2018, read the full forecast.