Today I’m giving you the scoop on how the market performed last year and what we can expect as this new year progresses.
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In 2019, we saw a very strong U.S. economy. Trade wars with China, Brexit, and the Trump impeachment dominated headlines.
Unemployment reached a 50-year low, and the GDP delivered on high expectations. The interest rate for a 30-year fixed mortgage ranged anywhere from 4.5% to 3.5% and finished at 3.75%.
Here in our Orange County market, the active inventory is at about 3,700 homes. That number may sound high, but it’s actually anemic for our market. As the year heats up, we’re anticipating inventory to rise; by summer, we can expect about 7,000 homes on the market.
For those selling homes right now, you have no competition, so take advantage of it. On the buyers’ side, there aren't a lot of homes to choose from. Still, if you find something to your liking, be sure to put in a competitive offer—I’m sure the seller will take it.
Overall, 2020 will look a lot like 2019, just a tad hotter.
We’ll likely see a 3% to 4% growth in demand around the spring and summer. The housing cycle for 2020 will mirror 2019: We’ll start slow in the first quarter, heat up in spring, top out in summer, and cool off come fall.
If you’re in the market for a luxury property, now is a fantastic time. Days on market for that bracket is currently between 175 and 275 days, so conditions are prime for striking a good deal.
I foresee interest rates remaining about the same in 2020. If our economy continues trending upward, we may even see a slight increase. However, if developments regarding trade wars or Brexit rock the boat, we could see a small decrease to about 3.5% to 3.75%. To any potential buyers on the fence: Lock those rates in, get the house now.
Overall, 2020 will look a lot like 2019, just a tad hotter. Buyers need to be patient, as multiple-offer situations will become more common. If you have any questions about what the year ahead holds or if you’re thinking of buying or selling now, please reach out to me. I’m always happy to help.
