5 Real Estate Trends To Watch In 2016

Dated: 02/12/2016

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Trends in Real Estate for 2016

At the close of last year, many real estate experts predicted the U.S. Federal Reserve would raise interest rates in 2015. That prediction never came to be, but even if rates rise later this month or next year, Ralph McLaughlin, a housing economist at Trulia, doesn't think it will scare away many buyers.

If rates do increase, it could be as little as a quarter percent. McLaughlin doesn't expect that to have a big impact on the market, but it could temper home price growth, "which is good news for prospective homebuyers," he says. "Interest rates won't have much of an effect on the 'rent versus buy' math," he explains. "Buying would still be cheaper than renting in most metros around the country."

The threat of last year's rumored rate increase propelled some prospective buyers into action, but Nela Richardson, chief economist for national real estate brokerage Redfin, doesn't see that same pattern repeating itself. "Buyers now don't seem to be all that spurred or driven by a rate increase," she says. "That lack of urgency will translate into next year's housing market. There's interest, but there's not a lot of inventory to buy."

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