Real Estate in 2018: What Your Clients Need to Know

May 4, 2018

Every broker knows that the real estate market is something that will never be fully understood. From ups and downs in the market to outside influences that affect sales and interest at the drop of a hat, it’s more about forecasting and planning for the future than just taking care of what’s going on right now.

In fact, pointed out that tech trends are ruling over the course of real estate not just in 2018, but moving forward. From augmented reality to blockchain to chat bots, technology is just the way the world of real estate works.

But besides the latest in tech, there’s just good old fashioned buying and selling know-how that needs to be considered as basic knowledge, like getting real estate broker insurance if you’re a broker. Here’s a look at what your clients need to know this year.

Millennial Buyers Will Cut Into Market Share

It’s just a fact of life that one generation will begat another, so as millennials (born between 1980-1998) age they’ll start buying homes. While this isn’t a mind-blowing idea, it’s still important to be on the up-and-up as to their buying interest.

The market will continue to see an increase in the number of millennial buyers, especially with growing incomes and an interest to get away from rent payments. By the end of the year, millennial buyers may make up to 43% of home buyers in the country.

Home Price Increases Will Slow Up A Bit also points out that home prices won’t rise as drastically as in recent years. Appreciation is expected to slow to 3.2% compared with the 5.5% in 2017. Entry-level or first-time homes will see the highest price increases and most of the slowing will be felt in the higher-priced segment.

Home Sales Will Soar

The number of existing-home sales was initially expected to increase about 3.5%, to 5.64 million this year, according to the National Association of Realtors. But that number has changed as the NAR predicts that existing-home purchases will see another 2.8% increase to a total of 5.8 million. The NAR says that due to this, buyers may have to come to a compromise as far as giving up their “must-haves” like commute time, size of home, and price.

Additionally, mortgage rates are expected to reach 5.0% by the end of the year due to a sold rise in economic growth, inflationary pressure, and monetary policy normalizations in the year ahead.

About Associations Liability Insurance Agency (ALIA)

The ALIA Team (part of the Riverton Insurance Agency Corporation) specializes in helping real estate professionals find the affordable and comprehensive coverage they need, without the hassle. ALIA dates its roots to 1991 with the founding of FREA, Foundation of Real Estate Associates. In 2013, ALIA was created to work with multiple insurance companies thereby broadening the portfolio of products to customers. In 2017, ALIA was purchased by Riverton Insurance Agency Corp. For more information on how we can ensure you have the appropriate coverage for your business, contact us today at (800) 882-4410.