Investing in real estate has been proven to be the best creator of wealth for those that are prudent, patient and have a little bit of luck. Luck being the uncontrollable factor of independent actors like that of tenants city bureaucrats and mother nature. However, being prepared to make decisions based on emerging trends generally improves profitability. Here are five trends that are not only happening for the year but will continue for the foreseeable future.
1. A growing number of Americans are reaching their 60s and 70s.
The Number of Americans over 80 will double, from 6 million to 12 million, in the next two decades. For most, this will mean downsizing and moving out of their current home. Because there is a shortage of low-income housing nationwide, smaller, more affordable one level homes are becoming a hot commodity for this age group.
2. Gen Z (born between 1995 and 2015) has secured home loans faster and more often than that of Millennials.
Like Millennials (born between 1985 and 2000), Gen Z is also laden with student debt, which means smaller and more affordable housing is critical for their budgets. The point to remember is that Gen Z is not like Millennials in their ideas of owning a home.
3. Recession is not likely for this coming year.
The economy is still performing well and likely to be relatively steady for the next few years, according to the Congressional Budget Office. With continued oversight in lending, there is a possibility of a slowdown in home ownership to a new normal, but fears of a housing market crash are unlikely. The bigger problem will be meeting the need for lower-income housing.
4. A push towards suburbs will continue for Millennials.
As the age of millennials grows, so will their families. There is a trend to move outside the big cities to developments with more amenities. This growing group of homeowners and renters like to have public transportation, eateries, office space, retail, and recreation, all within walking distance.
5. The Rise of Zillow
Zillow is expanding its iBuyer program, and it continues to be popular with the younger generation that is tech-savvy. iBuyer is the #1 trend in real estate and for a good reason. It’s fast convenient and reduces the risk of selling before buying and vice versa. iBuyer is not available in all cities, but it is expanding into six new markets for 2020. However, the convenience of Zillow is not limited to sellers and buyers; its a convenient tool for renters and real estate entities also.
Regardless of what is trending today, things will change. It’s always a good idea to have someone with experience in your area to decipher what trend will impact your investment. Having an experienced management company will make your investment experience more pleasant and reduce the hassle of interpreting what trend may or may not be taking place in your area.
We’re here to make the investment and rental process more pleasant and less expensive. Contact us at Blue Mountain Real Estate & Property Management today. We’d love to tell you more.