This year is almost over and 2019 could be shaping up to be the best year to buy a home.

One mortgage expert, HomeStreet Bank Senior Vice President Andy McDonough, who has more than 20 years of experience in the industry, predicted only the strongest lenders will survive the upcoming year.

McDonough explained that 2019 could see a significant shift, becoming a borrower’s market across the U.S.

But that isn’t the only prediction McDonough is making. Here are five predictions he says lenders can bank on in 2019:

1. Housing market will continue to improve nationally – particularly in large metro areas.

Recent report have shown a drop in new home sales and existing home sales, even as home prices continue to rise. However, McDonough forecasts the housing market will still show improvement. And he isn’t the only one with this prediction. A recent survey from the National Association of Realtors shows Realtors believe the housing market will improve over the next six months.

2. Interest rates will continue to rise in 2019, decreasing buying power.

Interest rates are going up. The latest Mortgage Bankers Association survey shows the 30-year fixed-rate mortgage interest rate increased to its highest level since February 2011 – 5.11%. This trend isn’t changing in 2019. Most experts predict the Federal Reserve will raise rates once more in December 2018 with another two to three rate hikes to follow in 2019.

3. If current conditions continue, 2019 will be a buyers market.

This year was clearly a seller’s market as a flood of potential homebuyers fought over the market’s limited housing inventory. Next year, however, could sing a different tune. As home prices continue to rise alongside interest rates, affordability continues to decrease. As affordability falls, the housing market could see a significant decrease in interested homebuyers.

4. Underperformers and smaller mortgage lenders will feel the squeeze in 2019.

2018 was no walk in the park for mortgage lenders as the industry reported its first quarterly loss in loan profits since 2014. Next year will be much the same story as interest rates continue to rise and interested homebuyers dwindle.

5. Refinancing will come to a near standstill in 2019.

Understandably, refinancing will all but cease in the next year as interest rates rise. The one exception may be borrowers refinancing out of FHAs in order to shed their mortgage insurance. But even then, borrowers will carefully weigh their options, and could decide to keep their low interest rate despite the rise.

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