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Outlook – 2017 Real Estate Market

Outlook – 2017 Real Estate Market

According to national realtor association interest rate for mortgage can be as high as 4.5% for this year. The anticipation of further increase is based on Fed rate hike of 0.75% in December 2016.Mortgage rates tend to move with the government’s 10-year Treasury note, which serves as a benchmark for mortgages. Interest rates on the notes have already risen since Donald Trump was elected president and on signals the Fed would continue to tighten monetary policy.

The Fed increased its benchmark interest rate by one-quarter of a percentage point on this first quarter 2017. Higher interest rate means paying more to the lender’s interest. Comparing average mortgage rate 8.5% for past 35 year, this is not to be panicked yet.

National average sales price for existing home price recorded 4.9% in increase year to date. Increase would top 3.9% this year. New York and New Jersey metro area rose only 1.8% compared with the same period a year ago. Slow rise in price in metro area would impact to group of home buyer especially for the young.

Ben Carson was confirmed as the Secretary of Housing and Urban Development by Trump administration. We also expect loosening of provision of Doss-Frank which enacted in 2010 in response to financial crisis. The Dodd-Frank Act includes titles that profoundly affect consumer lending in the United States and increase government scrutiny of providers of consumer financial services. Democrats say that the financial system is more stable than it has been for a long time. The Act adversely has affected small community based bank across the country that are responsible most of lending activity. We also expect 1billion dollar government sponsored project

If Trump administration carries out 1-trillion dollar infra-structure projects rebuilding of American road and bridge then would create much domestic jobs that enable boosting economy in local and national level. That lead to many housing construction as well.

On luxury house sector, Chinese and Middle Eastern investor are shying away from U.S. We are not certain this is just temporary withdrawal or continuous trend yet. Among other policy changes introduced in new administration, tax policy concerns most in real estate. The main points of the Trump’s proposal are as follow – a reduction in the number of tax brackets, from seven to three. A big increase in the standard deduction.

If the Trump administration caps deductions at even $100,000, as many experts suggested, that would not hit most borrowers because on that $500,000 (which is more than most loans in general) the total annual interest payment is about $23,000 in average. The vast majority of those who do benefit earn more than $100,000 a year and are not the most cost-burdened homeowners.

Despite the small number of borrowers a cap would affect, real estate industry leaders oppose any changes, especially in an environment where they are trying to convince young millennials that a home is a good investment.

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Stephen Lee

He has been in Real Estate industry in about 20 years and has been Broker of Record for 9 years. His experience includes residential, commercial, and property management. Prior to involving with Real Estate business, he has been involved in the digital communication equipment industry utilizing his engineering background and education, including running own company. He has established C Land Realty in 2011 which has grown to staffing over 100 Real Estate agents and the annual transaction amount of over $110,000,000 today.

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One thought on “Outlook – 2017 Real Estate Market”

  • Stephen Lee

    January 28, 2019 at 3:44 am

    Testing…

    Reply

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