FINANCE
Peering into the 2018
housing crystal ball
Last year was a crazy time for selling and buying
houses. Record-low inventory drove prices higher,
but buyers took advantage of mortgage rates that
didn’t rise, keeping their payments manageable. The
new election and our new president have consumer
confidence on the rise. The new year seems to show
a similar trend, and here’s what the experts see in the
tea leaves:
JEFF
• Home sales are expected to start slowly but then
ROSEN
pick up quickly as changes in the tax bill will encour-
age people to look to buy homes — especially renters who
were frustrated in 2017 with the lack of inventory. With more
renters entering the market, this will put upward pressure
on the price of home sales.
• With the lack of inventory and rising prices, home values
will increase. Combined with stable low mortgage rates
(rates have risen in the first quarter of 2018), homeowners
will be encouraged to refinance or renovate to leverage the
equity in their home. Higher home values mean more bor-
rowing power for current homeowners, who may be looking
to consolidate debt to save money.
• As millennials age, they will likely listen to their parents’ ad-
vice to invest instead of rent, and a growing share of them
will look to buy homes. Their advice may also be driven by
not wanting them in their basements anymore. (That was
humor.) Single millennials are expected to show an interest
in real estate investment in 2018.
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NEW JERSEY COPS
■ FEBRUARY 2018
•
Renovation loans are also on the increase, as more people
decide to expand and renovate their existing homes to suit
their changing needs.
• FNMA and Freddie Mac have loosened their guidelines to
help borrowers. Income stipulations and limits on debt ra-
tios (the amount of debt as a percentage of your income)
have been raised. This allows more prospective buyers to
have more purchasing power, increasing the pool of people
looking to buy homes.
What does this mean to you? All of the facts above point to a busy
real estate season, with home values and prices rising. If you own
a home and have been hoping to refinance to save money each
month or maybe do some renovations, the increase in your equi-
ty combined with low mortgage rates will create the perfect op-
portunity for you in 2018. If you have been thinking about selling
your home, take advantage of the hot market in the first quarter
to list and get top dollar for your home before inventory increas-
es in the later spring. And if you’ve been thinking about buying a
home, now is the perfect time to jump into the real estate market
and stop throwing your money at rent. Talk to a mortgage profes-
sional trusted by law enforcement about all your options. Your best
opportunity may be in the first half of the year to get the most for
your money. d
Jeff Rosen is the national director of Lending to America’s Heroes.
Call Jeff at 908-415-6050. Unlike other lending programs, the Lend-
ing to America’s Heroes Program has no bank fees and no mainte-
nance fees.