Out With The Old, In With The New: The 2018 Real Estate Outlook Is Looking Good

Written by on 12.12.17 in Investment Trends, MultiFamily - No comments

If you’re German, you might join your family at midnight to drop molten lead into cold water and make predictions about the year ahead based on the shape it takes.

If you’re Russian, you will gather at one minute to midnight, write a wish on a small piece of paper, burn it over a full champagne glass and drink the ashes before the clock strikes 12.

And if you’re an American with a thriving national real estate business to answer to, you might be thinking less about the party and more about the steady direction of the real estate industry in the year ahead.

It’s not all conjecture: 2018 is shaping up to be a close reflection of 2017, which ushered in growing home prices across the country and solidified the recovery of the real estate industry. In other words, 2018 is starting to look pretty good.

That said, the biggest bane of the industry this year—low inventory—will continue in 2018. Unfortunately, new-home starts and property listings aren’t keeping pace with consumer demand. Additionally, agents across the industry will continue to focus on winning listings over finding buyers. This will place additional pressure on prices, which can be expected to remain high.

Another trend that will likely grow next year is the influx of foreign capital into the real estate industry, particularly from Chinese cash buyers. If this year is any indication, these investors—some of whom buy sight unseen—will continue to drive up prices in high-end coastal markets like Los Angeles, Miami, New York, Seattle and San Francisco. This will have the same effect it’s already had—making housing more difficult for priced-out first-time homebuyers.

Keep an eye on whether these investors—who will own a sizable part of the market in select cities—try to offload some of their properties as the industry continues to recover and they see financial gain in selling portions of their portfolios.


Source: RISMedia

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