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Housing and Real Estate Trends for 2018

By Chris Porter | February 17, 2018

The evolution of the real estate market is unstoppable with new trends emerging every year.  As the economy shifts into an even higher gear, with more consumers making plans to own homes, there is a lot you can expect. Compared to 2017 and other past years, you can expect 2018 to take you on a long ride in real estate as highlighted by

A new family home started

Some of the main housing and real estate trends include:

Supply meets demand
From market analysis and after about three years of crushing shortages in homes for sale, especially homes within the consumers’ budgets, predictions for 2018 show that buyers will gain more control over the market as housing supply finally catches up with the buyers’ demands.

Most potential homeowners who have been frustrated over the past few years are most likely to find homes matching their budgets. Bullish construction is expected to rise, turning the ship around in favor of homeowners by bringing up new homes, therefore increasing opportunities for more people to trade up into new homes.

As a home buyer, you shouldn’t rush into buying early in the year – the upper tiers will get relief before the middle and the lower tiers. With the market easing up, you can expect the prices of homes to drop, slowing down to a 3.2 percent growth, annually. Unfortunately, this causes slow appreciation which leads to a price increase.

While you can expect an overall rise in property prices, you will also see more of low-priced homes. Keep this in mind; it will get worse before it gets better.

Tax reforms
With the Republican Party’s proposition for changes to the taxation system, everything can change. However, the jury is still out on this since the House, and the State versions remain in limbo.

In case a version of the tax reforms passes on the provision affecting real estate, the number of homes on sale may decrease, and the home prices may drop. The tax reform may affect the high-tier homes more.

More Millennials expected to gain independence
Over the years, the housing market has been challenging to millennials leaving more millennials stuck in their parents’ basements. Even though millennials will still have to deal with student loans, it may be easier for millennials to take out mortgages on homes in 2018 than in the previous years.

This is probably because of rising income and an overall stronger economy, and better career development.

Rise in Short-term Rentals

2018 will see an increase short-term rental homes and a thriving market, which has created a boom in opportunities for the single family and the large property owners.

The rise in short-term rentals has been necessitated by the need to earn extra cash from vacation homes. Everyone is looking for an opportunity to earn money so; you can expect this trend to grow in 2018.

Tiny homes
You’ve probably seen tiny homes trending in the past few months. Besides tiny homes, there also are mobile homes. Thanks to the versatility of small and mobile living, as well as the affordability, this is going to be an upward trend.

Community-driven spaces and co-living
Community-driven resident spaces and co-living will be on the rise in 2018 because of the renter demands and rights. These unique housing services will heighten competition in the commercial real estate.

Livability and quality of life as the deciding factors for housing
Despite the price ranges on projects, consumers will choose quality over the price. In 2018, you cannot expect homebuyers to compromise on convenience, safety, security, spacious homes, and parking space.

Even with increasing interest rates, 2018 will see more cautious but determined home buyers. Also, there will be more homes selling in high-tax states, a rise in micro units, on-demand access to renters, and further growth of the alternative and private real estate investors.

"Chris Porteous has significant experience in the financial markets with stints at Goldman Sachs, UBS Securities and DBRS. At DBRS, Chris extensively covered the Mortgage Backed Securities market, Covered Bonds and regulatory changes involved in the real estate markets. Chris currently runs a personal Real Estate Investment Trust with over 15 properties located in South Florida."
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