A new year has dawned clear and people are looking forward to real estate with aspirations and expectations at what’s in store for them. If you are into real estate, then you might want to know whether it would be a good year to make any investments. The predictions for San Diego will be made by the California Housing Market (CAR) and according to them; the existing home sales will rise by 6.3% in the year 2016.
Here are some other predictions made by real estate experts:
The job market will be stronger
2016 will be a good year for people in search for job, new industries are expected to start functioning giving excellent job opportunities to people in the California area. If there are job opportunities, there will be demand for homes and the real estate sector will be active. The state’s unemployment rate is expected to decrease to 5.5% when compared to 6.3% in 2015.
The buyer’s buying power is expected to increase
Buyers can pay monthly mortgage payments without failure, thanks to smaller mortgage rates. San Diego home prices might increase, but the buying power of people is also expected to increase.
The median home price will increase
It is predicted that the median home prices will increase to 491,300 in the early year. This was 476,300 in 2015. According to experts, this is the slowest appreciation of price rise in the last 5 years.
Mortgage rates are expected to rise
In October 2015, mortgage rates for 30-year fixed mortgage went to a rock bottom low of 3.85%. According to forecasts, this will rise in the year 2016, first to 4.2% and then to 5.1% by the end.
The Federal Reserve conducted a recent analysis on outstanding student loan debts and they were shocked to realize that it has reached to more than one trillion. The heavy burden of student loans is preventing many people from entering into the real estate market. If you are struggling to make student loans, then you might have to face hurdles in the underwriting and approval process.
Though everything looks good for 2016, it would also be advisable to keep a watch for recession as predicted by economy experts. If there is a recession looming in the background, you might want to be cautious while buying homes. But overall, the market looks good for real estate, with low interest rates and job availability.
San Diego is one of the best areas to invest in properties in 2016. Isn’t that good news for you? So what is your investment plan for the year? You might be looking out for a fast moving market where you can flip properties and make profit? Or are you looking for properties that you can rent out? For some people, this long-term equity growth potential is the most crucial factor.