In 2019 new buyers will struggle to break into the market, but homeowners and more established sellers will thrive.
The Housing Market Will Slow Down — But It’s a Good Thing
Many experts predict a market slow-down, but that isn’t necessarily a bad thing. The slower price appreciation and sales will not only give incomes the opportunity to catch up, it will help inventory normalize. Forbes says that in the long-term, this will establish a more robust housing market.
The Market for Buyers
Buying will be easier for homeowners and those with high incomes than it will be for first-timers who are just entering the market. Home prices are expected to rise relatively modestly in the coming year—by around two percent nationally—but mortgages will be impacted by rising rates, which are expected to reach 5.5 percent by the end of the year. Higher mortgage rates will reduce borrowers’ buying power.
Decreasing competition among buyers will make it easier for those who are well-positioned to buy. Newer homes, which typically come onto the market at higher price points, will target luxury buyers.
The Market for Sellers
2019 will be different for sellers as well. Gone are the days of a frenetic environment and run-up bidding wars. A slower market will mean more choices for buyers and thus less vying for opportunities. Those that price their homes competitively and mediate expectation will see success.
What Does This Mean for Bainbridge Island?
As will be the case in many markets around Puget Sound, first-time buyers may have a difficult time breaking into the market on Bainbridge Island. Data from the fourth quarter of 2018 revealed double-digit price growth appreciation on a year-over-year basis with a median sales price of $1,035,000 for single-family homes on Bainbridge Island—higher than any figure reported on a quarterly basis in 2018. Look for move-up and more established buyers to dominate the market, whether they already own property on Bainbridge Island or are Seattleites ready to embrace the Island life.
Considering making your next move in 2019? Contact us to discuss your opportunities today.