Row of colorful houses lining a street in San Francisco.

2020 Housing Market Predictions

HousingWire

HousingWire reports that while American home sales rose 3.9% in October, a declining housing inventory poses a challenge for what remains of the 2019 market. The article explains that though a recent spike in low-interest rates drives demand, “October posted a 3.1-month supply of inventory, marking the lowest October amount in the [RE/MAX] report’s 11-year history.” In retaliation of our nation’s withering housing inventory, home prices are rising, altering the median home price to $254,000—an 8.4% hike since last year. Still, Adam Contos—CEO of RE/MAX Holdings—remains hopeful. Contos suggests that an increase of new-homes in the market next year “may help address inventory constraints and potentially slow steady price gains.”

CCN

CCN’s November 21st report seems bleaker. They report that October’s starts “improved sharply,” boosting key housing metrics and seemingly reinforcing the “great health” of our housing market. Yet, CCN goes on to explain that data released by real estate brokerage firm, Redfin, discredits claims supporting our housing market’s health. The data reveals that, though there is a shortage in homes, sellers have been forced to reduce prices, “a clear indication that sellers are finding it difficult to attract buyers.”

CCN concludes that low mortgage rates bolstered the U.S. housing market at the beginning of the year. However, mortgage rates have begun to climb in spite of our mildly atrophying economy—pointing us towards a recession.

Zillow

A Zillow prediction reveals that they, too, believe 2020 may bear witness to a recession. In 2018, the popular online real estate company surveyed 100 real estate and economist experts. Of all experts surveyed, nearly half “expect the next recession to begin sometime in 2020, with Q1 being the most commonly selected quarter,” due to monetary policy.

Investopedia

In an October article discussing Zillow’s hypothesis, Investopedia concurs with CCN and Zillow’s predictions, citing Pulsenomics founder Terry Loebs. Loebs states, “Constrained home supply, persistent demand, very low unemployment, and steady economic growth have given a jolt to the near-term outlook for U.S. home prices…These conditions are overshadowing concerns that mortgage rate increases expected this year might quash the appetite of prospective home buyers.”

The verdict? Investopedia recommends “preparing a strategy managing risk and finding opportunity in any market condition.”

While our markets have seen all-time highs recently, it’s best to prepare for not-so-fair-weather scenarios.

Ready to invest in your future?

Open a Quontic Certificate of Deposit.
Share on facebook
Share on twitter
Share on linkedin
Share on email