The latest home price report from Case-Shiller posted much of the same, with home prices trending higher in October. In light of the new report, several industry experts weighed in on what this means for housing moving forward.
According to the report, home prices posted a slightly higher year-over-year gain with a 5.2% annual increase in October, up from a 4.9% increase in September.
“October home price appreciation was slower than what we expected. After 3 months of acceleration, home price appreciation is stabilizing,” said Tian Liu, chief economist for Genworth Mortgage Insurance.
Quicken Loans Vice President Bill Banfield added that the combination of a tight supply and strong demand for housing has pushed prices increasingly higher.
“At some point, more sellers are going to be willing to list their homes and the increased supply will be welcomed by first-time homebuyers looking for the goldilocks home - fitting their budget and lifestyle,” he said
Overall, Zillow Chief Economist Svenja Gudell said, “The U.S. housing market as a whole made great progress in 2015, as the big and occasionally volatile bounce off the bottom we experienced from 2012 through 2014 gave way to a more stable and sustainable environment.”
However, Gudell cautioned that there are still a number of housing challenges likely to shape the market in 2016 and beyond.
“The median age of first-time homebuyers will reach new highs next year as more Millennials delay key life decisions and stay in rental housing longer. This is likely to help rents keep rising, though at a slower pace than we’ve seen, which will contribute to worsening rental affordability,” said Gudell.
And on top of that, Gudell said, “The prospect of rising mortgage interest rates will make buying a home modestly more expensive, too. For those that can qualify for a loan and find a home within their budget, relatively affordable suburbs with walkable amenities and good access to the city will become increasingly attractive, particularly for young families.”
And for those who are searching, here a list of the best housing markets for Millennials.