In 2016, there will be an expected remarkable progress in housing markets according to a forecast released on Wednesday, Dec. 2. The forecast also named some local markets that will possibly generate impressive growth next year.
Realtor.com®, one of the companies offering online real estate services, issued a 2016 housing forecast stating that building of new home and existing home market gains will drive total home sales to its highest level since 2006.
Realtor.com® Chief Economist Jonathan Smoke said, "Next year's moderate gains in existing prices and sales, versus the accelerated growth we've seen in previous years, indicate that we are entering a normal, but healthy housing market." He also said that the developments in the last few years are responsible for the recovery of the existing home market.
"New home sales and starts will bring overall sales to levels we have not seen since 2006 and will help set the stage for a healthy new home market," Smoke added.
Smoke together with his colleagues conducted a research using a statistical model predicting the future values of home sales and prices. The team looked over the trends for the past few years and variations every season of housing and economic data of the 100 biggest markets in the country.
According to Smoke, the home buyers that will greatly contribute to next year's impressive growth are divided by three segments, namely: older millennials, younger gen X'ers, and retirees, with ages ranging from 25-34 years old, 35-44 years old and 65-74 years old, respectively. PR Newswire reported that 30 percent of the existing home market will come from the Millennials, comprising the largest demographic home buyers in 2016.
The following are the top ten local markets listed by Realtor.com®, that will yield an impressive progress in 2016.
1. Providence, RI
2. St. Louis, MO
3. San Diego, CA
4. Sacramento, CA
5. Atlanta, GA
6. New Orleans, LA
7. Memphis, TN
8. Charlotte, NC
9. Virginia Beach, VA
10. Boston, MA
"Some markets have been hot and are remaining hot (San Diego, Sacramento, Boston, Atlanta). Some are just now seeing signs of recovery based on substantially better economic conditions forecasted for next year (Providence, New Orleans, Virginia Beach, St. Louis). Some are spillover markets from very hot markets (Providence, Sacramento), and most have one or more key demographic driving demand," Smoke stated.
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