Notable Mortgage Trends to Know

Within the mortgage world, it’s vital to stay on top of various market indicators that can dictate a huge part of the financial picture for your next home loan. At Altius Mortgage and our partners at Mortgage Ogden, our brokers stay on top of these kinds of trends at all times to give you the most informed perspective possible.

The housing picture is expected to improve in the remainder of 2018, and has already done so –though parts of the market will remain challenging as they’ve always been. Let’s look at a few important trends to keep an eye on.

Home Price Deceleration

In a particular piece of good news for first time homebuyers, appreciation on home prices is expected to slow down after a few insane years in this area. Home prices rose a ridiculous 6.3 percent in 2016, per the FHFA, and are on track to exceed 6 percent in 2017 as well. For 2018, though, it’s expected that the increase will be closer to just 4 percent.

One big factor here is home construction, which experts expect to rise sharply in 2018. Single-family housing is expected to rise about 8 percent in 2018.

Home Sales Could Rise

Despite trends in recent years where homes were harder and harder to find, 2018 could have some rays of light. A growth in inventory is finally expected around the fall of 2018, and resales of existing homes are expected to rise modestly. Cities in the south will show the most growth here, with up to 6 percent home sales growth in many southern markets with strong regional economies.

Rising Mortgage Rates Possible

Current mortgage rates are expected to rise in 2018, potentially up to about 4.7 percent compared to 4.07 percent in 2017. However, note that interest rates are typically resistant to precise prediction – most people expected similar rises in 2017, and these actually never came. The rates did indeed rise at the start of the year, but then they actually dropped from spring until the end of the year. So take this forecast with a grain of salt.

More Equity, Lines of Credit

As home values rise, homeowners gain more equity. Banks expect many homeowners to borrow against that equity in 2018, with about 1.6 million homeowners forecasted to receive new home equity lines of credit for the year – a 16 percent increase over 2017. By the year 2022, TransUnion predicts that 10 million homeowners will get lines of credit, double the number from the previous five years.

For more on mortgage trends to watch for this year, or to learn about any of our mortgage services, speak to the pros at Altius Mortgage today.