2018 Housing Market Forecast

Key Takeaways

It is important to understand that nobody can predict the housing market without exhibiting at least some room for error.

The cost of homeownership should go up, as interest rates are expected to rise and inventory remains tight.

Generation Z may get its first official glimpse of what it means to participate in the housing market.

With 2017 nearly in the books, now is just as good of a time as any to take a crack at the 2018 housing market forecast. And while predicting exactly what will happen in the coming year is nothing more than a fool’s errand, it can be incredibly valuable to make educated guesses on current trends, and how they are expected to carry over into January and beyond. You see, I am not going to sit here and tell you what will happen in 2018, but rather present you with the facts and suggest what is most likely to happen.

Nobody can predict the future, and you are only fooling yourself if you think you can, but it’s entirely possible to prepare for what’s in store by understanding where we came from. If you are interested in giving yourself an advantage over the next twelve months, I highly recommend taking a look at what transpired in 2017. Only then will you have enough data to identify viable trends that should carry over into the new year. If you can’t identify any trends on your own, feel free to take a look at what we found, and how it will impact the 2018 housing market forecast.

Real Estate Market Forecast

Again, nobody knows exactly what the 2018 housing market forecast has in store for us, but it can’t hurt to make a few guess, especially if they are founded on sound data. Below you will find a list of four scenarios I believe will play out more than likely in the 2018 housing market forecast.

1. Prices Will Continue To Increase

Industry professionals and pundits alike aren’t hesitant to suggest that prices will continue to rise for the better part of 2018, and I am inclined to agree with them. As recently as November, the median home value in the United States was $203,400, but there’s no way we don’t see that number climb. In the last year alone, United States home values jumped as much as 6.5 percent, and the same lack of inventory that motivated increases over the last 12 months should continue to push prices higher, albeit at a slower pace. Inventory will remain tight in 2018, but new homes are expected to hit the market and chip away at the problem. As a result, I would expect prices to increase, but not at the rate we saw in 2017. The powers that be at Zillow have forecasted a three percent increase, and I see no reason to think otherwise.