Today we're back with our annual real estate predictions for 2017. Interest rates are the big thing to watch because they'll affect prices, inventory, and the whole market overall.
We've been predicting what will happen in the real estate market for the following 12 months for about five years now. At the risk of tooting my own horn, a lot of the things that we've predicted have ended up happening.
With that in mind, we're back with some predictions for the 2017 market.
The first thing we know without a shadow of a doubt is that interest rates will go up. It's only a matter of how high rates will go up. I predict they will go up to the 5% range by the end of the summer or the fall, and that's a big number. If you're looking to buy a home, this means the cost of your money will get much more expensive. If you're thinking about moving, you might have to shift your timeline up. Even if you don't want to pay to break your current lease and buy a home, you'll lose that same amount of money 10 or 20 times over if interest rates go up by 0.25% or 0.5%.
We know without a shadow of a doubt that interest rates are going up.
Be sure you understand the cost of your money.
So what will this mean for you as a home seller? Home prices will flatline in some areas and come down in other areas. We know certain areas like D.C., Alexandria, Arlington, and most places inside the beltway will stay consistent. The areas that won't stay consistent are the tertiary market with builders still constructing new homes, like Prince William County, Loudon County, Stafford County, and some areas out in Maryland. I expect prices to pull back a bit in these areas.
I don't think sales activity will dip too much because we had a really robust past couple years. We'll still have a lot a people moving in and out. Overall for the market, I don't think we'll see much movement, so you need to prepare for that.
Hopefully this gives you a better idea of where things stand and where they're headed in our market from a technical standpoint. If you're looking to buy or sell in our area, give us a call or send us an email soon so we can help you prepare. We'd love to hear from you!
