Real Estate Forecast for Baby Boomers GenX'ers & Millennials

The New Real Estate Forecast: by Josie Neglia The next few years will be a great time to buy or sell! See why... My research of news from experts like Tim Harris (20 year veteran in the Real Estate Industry) and Jonathan Smoke (Chief Economist for Realtor.com) and Political Strategist Harry S. Dent, all revealed some very astounding facts regarding our market today and the positive forecast of our Real Estate Industry in the coming years..

There are Significant Trends that are Changing the Real Estate Market Today

The 8 Fundamental Things that drive the Real Estate Market: 1. The Economy/Employment Sector- job creation has been strong. In the US, there were 242K jobs created in Feb 2016. 2. Household Formation: We are in a good rhythm! The largest generation in history, the Baby Boomers (80 Million people born between 1946-1964) are reaching retirement age and making decisions about downsizing and selling their large homes for smaller ones. Millennials which count for 75 Million people born between 1977-1994, are the 2nd largest generation in history and were the largest buyers last year. 3. Supply - There has been 41 straight months of low supply of homes for sale, meaning that there are more buyers that sellers. The demand is growing faster than supply so it is positive for the market. Stock market and negative messages in the news are not stopping buyers. Also, there is a little bit of new construction which will also boost the market. 4. Credit: is still holding us back. It is still tight and hasn’t changed all that much in the past few years. It is still an extremely difficult time to qualify for a mortgage. But the reality is that the economy is improving and the annual household income and credit scores have improved. Also, new programs are being introduced to help 1st time home buyers like NACA.com and Bank of America. 5. Foreclosures - The foreclosure crisis chapter is finally closing. Investors that could take advantage of the REO's and Short Sales is coming to an end. Properties are no longer at the discounts they were a few years ago causing a decline in their buying power. House prices are now more stabalized and rising causing an increase in equity for existing home owners. 6. Luxury Market: There is a slow down in the luxury market (higher priced real estate: $1 Million +) due to stock market fluctuations we had last August and September, 2015 and then again in Jan and Feb, 2016. 7. Foreign Buyers: (e.g. Russian & Chinese) are slowing down year after year due to weaknesses in the other countries and the growing strength and appreciation of the US dollar. 8. First-Time Home Buyers: Solid growth in the first-time home buyers over the last year. A large portion of last years drive comes from first time home-buyers. Renting is no longer as popular because prices have sky-rocketed. In many cities Millennial's are realizing that it may be cheaper in the long run to own than to rent. Young people are seeing that real estate has the most potential returns for their life and offers a quality of life that they cannot get in the rental market on an affordable basis in the long term.

• Jonathan Smoke says: "Renting in the United States is an inflation trap. Households who rent are most likely to have little to no savings, which limits their ability to provide opportunity for their children or to handle unexpected expenses. More and more households are spending 50% or more of their income on housing—and that will have long-term damaging consequences for our economy and our society... The best long-term strategy is to ensure renters, who are able, will eventually become owners."

Politics: Thankfully there is not a tight correlation between real estate and presidential election years! Actually in history, there have been more sales in election years than other years (you can read more from Political Strategist Harry S. Dent). Therefore, whomever becomes president will not affect the real estate market significantly. What drives demand is LIFE: life events and life changes, like families growing or downsizing, births and deaths, retirement, job changes and changes in lifestyle. Overall the forecast is looking good and there is no threat of a crash since all signs point to great real estate sales in the next 10-15 years. Also, with some of the lowest interest rates in years, and housing demand being high, all predictions are gearing toward 2016 being the one of the BEST YEARS SINCE 2006! If you are thinking about making a move, please let me help. Let me BUY YOU LUNCH so I can get to know your reasons for wanting a great new home. Whether you want to downsize or get something for your growing family or just need a change, I would love to help you find the home of your dreams! Josie Neglia B.A. SellingLongBeach.com 310-869-8313 Realtor® RE/MAX #01918172 P.S. I recently went to a NACA.com workshop for 1st time home buyers and real estate agents working with NACA.com to find out about the New Programs for 1st time home buyers and can advise you on some very generous programs out there.