More Hope for Young People Looking to Enter the Housing Market as Average Prices Fall in the First Part of 2017
If your business has anything at all to do with real estate, now could be a profitable time for you. That’s because falling housing prices create opportunities for first-time homebuyers.
The situation in terms of getting on the property ladder has been a point of contention between millennials and their elders for some time now. Where previous generations sought to be homeowners as young as possible and were in a market where this was possible for a lot of people with normal incomes, today’s twenty- and thirty-somethings have not had the same advantages, thanks to soaring house prices.
Rising prices in the housing market are good news for homeowners, but terrible news for those aspiring to buy a house. The reverse is also true. A drop in house prices, or at least a slowdown in growth, is either good or bad news depending which side of the fence you are on.
Prices Dropping in Some Areas
Young people, and indeed anyone else hoping to become a first-time homebuyer in the near future, should feel encouraged by data showing that house prices fell in some regions of the world during the early part of 2017. This is the first time prices in the UK have gone down in nearly two years, for instance, and property site Zoopla has estimated that the average house in the UK now costs £1000 less than it did at the start of 2017. In the other parts of the world, housing markets are more of a mixed bag, so it can pay to keep your ear to the ground.
So, Will We See More Millennial Clients Buying Homes?
There are a number of factors currently working in favor of younger people buying homes. Low mortgage rates and evidence of decreasing house prices may be enough to enable some people to get on the property ladder. In Europe, Brexit may have a role to play in unexpected ways. For example, London is expected to become less of a financial hub outside of the EU, and young professionals may begin to consider relocating to less expensive parts of the country.
Less demand in metropolitan areas due to less need to be within easy reach for certain careers may also help the high prices in these regions come down a little. Of course, only time will tell how the market will change and whether this will be in ways that help or hinder younger first-time buyers. However, signs of prices starting to fall could suggest that more young individuals, couples and families might start to consider buying a home as a viable prospect once again.
Will People Move Less if Prices Keep Falling?
Of course, first-time buyers are not all the market needs to thrive. With house prices lower than they have been for a while, many people who don’t have a pressing reason to move may simply choose to watch and wait, much like taking a “bearish” position in share dealing, to see if they could get a better price for their house in the future. While there will always be people who are strongly motivated to sell, lower prices will mean less incentive to try and move up the property ladder, and therefore this could be a quieter time for house sales in general.
Then again, the start of the year is often quiet in this industry, so revisiting house prices and movement statistics after the traditionally busier spring period may offer more insight into the direction prices are truly moving in and why.