The Great Recession of 2008 shook the U.S. housing market to its core.
Up until 2013, there were roughly 41% less new constructions per year than 2008. Home values were crushed and millions of Americans were trapped in underwater mortgages.
However, nearly a decade later, the U.S. housing market has fought back and remains strong.
Just last June, home resales achieved the third best month since the housing bubble burst.
It is a great time to buy or sell a single family home. Here we are going to walk you through the fundamentals of the market.
Read on to learn who is buying, why real estate is a great investment, and where the hottest individual markets are.
Who will Fuel the U.S. Housing Market Over the Next Decade?
Before you dive into the housing market, it is wise to make sure the growth is sustainable. That being said, who will power home sales is an important question.
In the United States, future growth will be driven by minorities, specifically Hispanic millennials. Over the decade ending in 2025, minorities will produce over 10 million new households in the United States.
Hispanics will make up one-third of that 10 million. The keys to achieving this projection are access to affordable housing and growth in jobs and wages for Hispanic Americans.
These are two metrics to closely watch as you consider investing in a new home.
Is Real Estate Still a Great Investment?
One of the big questions for millennials is whether to rent or buy. After home values crashed following the Great Recession, those that advocated for renting were justified.
Now that the U.S. housing market is strong again, however, investing in real estate is once again a strong choice.
For many Americans, home equity is like a mandated savings account. Without the hundreds of dollars contributing to equity each month, too many would lack the ability to renovate their home, purchase a pool, or pay off debt.
In addition, owning a home has tax benefits when Uncle Sam comes calling every April. By deducting mortgage interest and property taxes, you can reduce your adjusted gross income, thereby lowering the amount of taxes you owe.
Where are the Hottest Markets to Invest in?
Deciding where to buy is just the first step in making a sound home investment. Perhaps more important is selecting an attractive market to buy in.
While the national market at large may be growing, there may be individual regions that are declining. This may be due to a combination of economic factors, such as an unfavorable job market.
So what are currently some of the hottest individual markets in the United States?
For starters, the west coast is on fire when it comes to housing sales. Washington and Oregon rank number one and two respectively for the hottest housing markets in the country.
At the township level, California’s Vallejo-Fairfield market in Solano County is the nation’s hottest. A number of other townships in the greater Bay Area ranked in the top 20 in the nation.
In fact, most listed homes are under contract in 31 days or less in this region.
Is it Time to Buy or Sell?
You bet. Performance indicators for the housing market are strong. The job market is also on good footing, meaning the housing market will continue to grow.
If you have any questions about the Los Angeles or Orange County housing market, feel free to drop a comment below or contact us.