In covering predictions for the housing market for 2017, Hinkle noted that single-family starts outpaced expectations in 2016 (rising in the third quarter after falling in the second quarter) and that trend is expected to continue into next year.
Experts predict overall expansion for housing in 2017. According to Hinkle, new home sales grew by 13.4 percent in 2016, which was slower than forecasted, but that pace is expected to continue to grow. Existing-home sales outpaced forecasts in 2016, but are expected to slow in 2017.
Mortgage rates are still historically low, according to Hinkle. As of October, the average 30-year FRM was 3.47 percent. By comparison, in October 1981, the average 30-year FRM was 18.45 percent. Rates have recently risen to above 4 percent and are expected to continue to rise in 2017, but remain below 5 percent.
A slow rise in new home construction is expected for 2017, and demand may outpace supply. Multifamily starts declined more than predicted in 2016, but are fully expected to grow in 2017.
According to Hinkle, trends that will impact homeownership in 2017 include: inventory, rates, prices, labor markets, buyer demographics, sales volume, and first-time buyer population. Experts say the market remains attractive to first-time buyers.
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