Predictions and outlook for the US real estate market are positive. That’s because the US economy is on a solid roll ever, bolstered by lower taxes, improved trading agreements, growing American confidence, happiness, comfort, freedom and the American dream has been kindled again.
Increased government spending, low but slowly rising interest rates, and the repatriation of business and corporate funds back to the US means it’s a healthy, safe market for everyone.
Foreign investment has been substantial because the world knows, the US is the place to be. American’s have always had a great attitude toward risk and business growth. Now the economy and business markets are allowing that spirit an opportunity to pay off.
Despite the market correction, experts feel this expansion could continue as long as business keeps coming back to the US. In the meantime, the job, wage, investment, and profit growth are giving real estate participants a lot of optimism.
To find out where you should be looking into the Real Estate market this year, Forbes grouped with Local Market Monitor, which tracks more than 300 housing markets. For each market CEO Ingo Winzer analyzed housing indicators such as Unit Sales, Average Sales Price, Median Sales Price, Average List Price, Sales to List Price Ratio, Inventory, Months of Supply, Market Time and Price Per Square Foot. He also analyzed broader growth trends to come up with 20 markets where you can invest your money in 2018 and still sleep easy.
To compile this list, Winzer began with 330 markets. He first removed the ones had populations below 500,000 and then discarded those that performed worst on key metrics. Finally, he drilled down to the 20 markets that scored the best across the five measures chosen. These measures were: one-year job growth, three-year population growth (2014 to 2017), one-year home price growth, affordability and Local Market Monitor’s own three-year home price forecast.
To judge affordability Winzer uses a measure of home price versus income price, which he calls the Equilibrium Home Price. That is the real current average home price in a market versus what that price would be if the historical relationship between home prices and income held for that market.
Finally, here are eight reasons why people are still eager to buy real estate:
- Home prices are appreciating, and it’s a safe investment over the long-term;
- Millennials need a home to raise their families;
- Rents are high giving property owners excellent ROI on rental properties;
- Flips of older properties continue to create incredible returns;
- Real estate is less risky;
- The economy is steady or improving;
- Foreigners including Canadians are eager to own US property;
Bankrupt buyers are over their seven-year prohibition from the last recession, and they can buy again.