While millennials are raring to buy, Gen Xers and boomers are pretty comfortable where they are, thank you very much. Boomers are living longer, healthier lives, and staying in their houses longer. Gen Xers often aren't quite done with raising kids or ready to retire, so except for the lucky ones trading up, they also aren't inclined to move.
Since older owners aren't quite chomping at the bit to give up their houses en masse—and with levels of new construction still low in most parts of the U.S.—there just won't be enough housing to meet the demand. And while in previous years this scarcity has driven up home prices, home price appreciation is finally flagging, with predicted growth of just 0.8%.
After the housing crash in 2008, which wiped out quite a few builders, those who remained have largely focused on higher-end developments with bigger profit margins. Although they're finally showing signs of a shift toward building more entry-level homes, faced with overwhelming demand, it will take a few years for a significant number to come to market.
How to buy a home in 2020
Those looking to buy an entry-level home will face a tough search, so they should be prepared for it to take a while—and to act quickly when needed.
Finding a property that is right for you and snatching it up before someone else does is going to be the primary challenge.
Those with a bit more to spend will have more to choose from, less competition, and possibly more motivated sellers.
How to sell a home in 2020
Sellers of entry-level homes should be sitting pretty, as those will continue to be the most in-demand properties next year. If anything, those sellers should be prepared to move out quickly! Others should brace themselves for a longer wait, especially as the price point moves up. The number of existing-home sales is expected to dip 1.8% next year. Higher-end sellers should do their homework: They might need to think about the competition and pricing their home competitively.
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