For over 30 years, Jacques Poujade has been working in the financial services industry. As the current Managing Partner at LendPlus, he is often working with people trying to discover alternative mortgage solutions to live out their dream of owning the right type of home for them. Whenever a new year begins, most assess their current financial situation and begin to wonder if it is time to buy a house for the first time, or a new home.
With 2019 right around the corner, he decided to share a few insights on what to expect in real estate in 2019.
Mortgage Rates Will Keep Going Up
Poujade has witnessed mortgage rates go up and up these last couple of years, nearing that of the recession last decade. Unfortunately, Poujade believes that it will continue to go up, perhaps even surpassing the 30-year, fixed rate mortgage of 5.8%. It isn’t what a lot of shoppers will want to hear, but that is reality we live in going into 2019.
There are several ways for a person to get a lower mortgage rate, but it will be a hindrance for a lot of first time buyers that mortgage rates are that way. Poujade’s company, LendPlus, is big on helping people tackle those high mortgage rates that seem impossible to deal with.
Inventory Will Increase
It isn’t all bad news for buyers, as there will be a little bit more inventory nationwide in 2019 compared to 2018 according to Poujade. There was a huge demand for homes in the last couple of years, mainly due to so many first-time home buyers. Now that that demand has been reached somewhat, inventory will take a slight increase.
Of course, competitive markets likely will not see that much of a difference. This is a gradual increase in inventory, so Poujade believes that it will mostly effect the less competitive markets early on.
Home Sales Will Decrease
Buying a home right now is still difficult for a lot of people. Most are dealing with years and years of price growth, as well as higher mortgage rates. Millennials in particular are wanting to buy, but it is not always feasible. Due to all of this, home sales across the board will drop slightly.
Selling a home might be a bit difficult in areas that aren’t super competitive if you ask Poujade. There are certainly plenty of people wanting to buy a home, but getting the finances in order can be tough.
Home Buying/Selling Continues to Be Innovative
Much like everything else in the world, there is more and more innovation when it comes to buying and selling a home. People are shopping for homes in a market all over the world thanks to the internet. There will be more iBuyers than ever in 2019, as Poujade does not see that trend slowing down at all.
Brokers are becoming a bit obsolete if they can’t serve a seller in other ways. Websites like Open-door and OfferPad allow people to sell homes directly. There will definitely be some changes as creative brokers will find a way to still be needed. The ones who do not evolve could very well be left in the dust when it is all said and done. That’s bad news for their business.
LendPlus has even jumped on the innovation trend by offering cryptocurrency as a payment method for mortgages.
Overall, Poujade does not predict anything too drastic to happen to real estate in 2019. There are just not enough crazy changes in the market right now. With that being said, we are getting close to the point where many in real estate feel like millennials will truly take over. The demand is expected to reach an all-time high around 2020. There will be a lot of people keeping their eyes on the situation as it all unfolds.
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