With the new year upon us, real estate executive Adam Hochfelder is excited for what will be another dynamic time in the world of real estate. Here are some of his predictions for the real estate market in 2019.
With record sale prices reported at the end of 2017, the real estate market has reached incredible heights. According to Hochfelder, in the last three months of the year only, the average sale price for a Manhattan apartment reached $1.95 million, making a 12% increase. During the same period the price per square foot reached to an amazing $1,645. With the average rental price hitting $4,071 from November 2017, rental prices have increased by 3.9% over the last year.
Although this year was one of the best for housing since 2007, according to Adam Hochfelder’s real estate forecast, the market is likely to get even more promising in 2019. Still we need to be prepared for some changes also. With an average sale price around $1.28 million, pricing is still moving up, although it is a bit slower in comparison.
Diving a little deeper Adam considers that the threat of rising interest rates for many years may surface in 2019. Furthermore, buyer demand will cool as rates rise, and that will put an additional downward pressure on prices. Rising interest rates together with lower prices can outcome in weaker buyer confidence, and that can only reinforce the cycle.
According to Adam's researches, some condo developments that were launched over the past few years may possibly see closings, as new rental buildings continue to hit the market and progress in their lease-ups. The shifting macro-economic climate is also expected to have an effect on real estate.
In 2019 we will probably see more buyers demanding deal contingencies, longer reviewing their contracts or making more demands of sellers. Furthermore, buyers might need longer time in order to make decisions, and they will require several visits to a property. One of the first changes that we might see is related to prime locations, meaning buyers will focus more on prime neighborhoods and blocks.
Furthermore, in Hochfelder's opinion, the tax reform will also will reflect favorably.
