Hope and Expectations

This Year: Hope for the Best, Expect the Worst.

In many markets, real estate professionals hope the good results they saw in 2019 continue. Interest rates remain low and the conforming loan rate just increased. Realtors tell us that inventory is tight - good news for sellers but bad news for buyers.

Yet, some listings languish, and the National Association of Realtors expects existing home sales to fall 1.8% in 2020. The unexpected factor is a 6% increase in new construction, as favorable market trends encourage builders to create more inventory. Supply increases, giving buyers new options.

Baby Boomers may make an inventory shortfall worse by staying in long-owned family homes instead of downsizing. Researchers at Berkeley University argue this might be a short-term trend, but, taking a longer view, listings for sale will rise faster than demand when Boomers are ready to sell.

To set your own hopes and expectations, know your neighborhood. It always helps to keep up with the latest news and watch national data, but check what you read against what you see around you.