While we’re nowhere near the plummeting market trends of 2008, analysts warn that 2019 will be a slow year for the housing market. There are a few factors at play here, and the ongoing government shutdown is only one of them. Here are the ways the housing market is predicted to slow going into 2019.
2019 to be Slow Year for Housing Market
The Fed is taking a very cautious stance on housing going into 2019: the word “patience” is coming up a lot. This, coupled with the ongoing government shutdown, has given a number of analysts pause. The economy is also much slower at the start of this year than it was at the start of last year.
Where, 12 months ago, there was a 4% increase projected for GDP, right now we’re looking at a roughly 2% increase on the year and falling. The longer the shutdown drags on, the lower that number gets and the less consumer confidence there is.
The biggest risk in the market seems to be the consumer sentiment. If consumers begin to feel as though a 2008-like situation is on the horizon they may clam up and reign in their spending dramatically. This could lead to the market slowing considerably, leaving houses on the market for longer and resulting in fewer sales.
There are a few factors at play: an unstable government is one, and repeated headlines regarding market trends is another. Mortgage rates staying on the increase is another thing keeping consumers cold on the housing market.
It’s not all downside, though. The consumers who still have confidence and go ahead with purchases in a slower housing market will reap some benefits. Namely, those looking to buy in a such a market are in a buyer’s market and have all the time in the world to look for a great deal.
Homes staying on the market longer leads to more affordability and flexibility for buyers. Real estate agents can leverage this to make properties look that much more attractive, even in a slower market.