Our show today was a recap of The State of The Real Estate Industry,The State of The U.S. Market for 2018; as presented by Brian Buffini Dcember 13, 2017
Cohosts: Thomas J. Nelson of Big Block Realty & Jonathan Denwood of Mail-Right.com discussed the NAR stats and Brian Buffini's ( Buffini & Company ) Bold Predictions for 2018.
We have seen a 22% increase in licensed Realtors since 2013, closing out 2017 with 1.30 Million licensed agents that belong to NAR.
The number of U.S. homes sold since 2015 has increased by about 4.17% in Q4 2017 and is predicted to increase by an additional 3.7% in 2018.
The U.S. Median Existing Home Price (re-sale) has increased by 16% since 2014 as we close out Q4 2017; 2014 saw $209,100 and 2017 is closing out about $245,100. Thomas adds -San Diego, CA is closing out at about $539,950 Median Sales Price, up from $465,000 in January 2017!
Single Family Home Starts (New Construction) is projected to be up 9.4% by 2018; still leaving us an inventory deficit of 250,000 more units needed by 2018 to keep up with the 50-year average. Housing demand is quite simply exceeding supply and has been since 2012 conservatively.
The U.S. Housing Inventory continues to be an issue of supply, down 6.4% in 2017 (190 Million Units) from 2016 inventory (2 Million Units). Essentially our housing supply is equal to 1994’s U.S. inventory, with one problem…We have 63 Million more citizens in the U.S.A. since then!
First Time Buyers are in decline, down 15% in 2017 at 29% of all U.S. home sales from 2016 where they were 34% of U.S. home sales. You can attribute this (in part) to student debt loans that outweigh Millennial incomes, lack of advancement within their careers, transient careers and or if they’ve been able to even secure a career in what they majored in in college.
The average rents in 100 major U.S. cities are higher than the average mortgage payments of homeowners in similar properties. By the way, not to knock renters as I was one and I depend on them for my properties, but in the U.S. a homeowner’s net worth is up to 46Xs that of a renter and statistically homeowners are better citizens as they contribute more to their local economy and have more to lose.
The GDP has seen 2 consecutive quarters of 3% growth and we will finish 2017 at 2.7% and projections for the GDP in 2018 overall is 2.7% growth.
CONTEXT:
Economic Factor 2006 2016
Single Family Home Prices $232,000 $236,000 (not much higher)
Unemployment 4.6% 4.9% (higher)
Home Sales 6.0 Million 5.3 Million (less)
Months Supply of Inventory 6.4 Months 4.2 months (less)
Distressed Sales 2.6% 5.4% (more)
Home Flipping 8.6% 5.0% (less)
Technically, it’s “worse” in 2016 than 2006, yet we were fine in 2016 and freaking out in 2006. Hmmm.
Mortgage Interest Rates (forecast) sit currently around 3.94% and projected to go up and finish 2018 at 4.5%. So, while anything below 8% in my opinion is fantastic, we’re still well below 5% by 2019. Now that makes a few hundred dollars / month difference in payments though, so if you’re sitting on the cusp of the next price bracket, there’s not time to lose in pulling the trigger on your purchase.
Mortgage Interest Rates Context: In 1990 Mortgage interest rates were 13.4% and have been 5.6% or lower since 2010. So, it’s not time to panic, but it is time to motivate!
The 3 Keys to Success in 2018 (are the same as they’ve been for year) …
1. Invest in relationships: The Law of The Harvest.
2. Stand Out with Service: Be ready to serve with excellence.
3. Develop Your Skills: Be willing to invest in yourself.
“Learn to work harder on yourself than you do on your job. If you work hard on your job you’ll make a living, if you work hard on yourself you can make a fortune.” Jim Rohn
Photo from Buffini & Company; Thomas is a coached a member.
CHECK OUT: THE PLAN TO SAVE REAL ESTATE
& THE HISTORY BEHIND "STOP ZILLOW"
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