Prediction for 2019 shows the housing market in the U.S will be moderately cold.

Indeed ’s mean the behavior for and sellers. Definitely, will be neither warm nor cold.

Because according data this of 2019. Our predictions revealed the housing market could be the coolest .

for professionals, home sellers and first-time .

This cold breeze in the housing market could be as something we’ve seen in the past . But, homeownership, after all, will continue rise along the subsequent months.

So far we predict eventually the real estate market will moderately cold during the first and the second trimester of 2019.

Nevertheless, After June this the housing market more time will take off. Inventory will rise up 2017 levels, and growth.

Meanwhile likely still positive, will be the lowest we’ve seen since 2014 or possibly even 2011.

However, and house-flippers will away from the cooling market. While, real estate companies that buy from to quickly sell a profit will face their first serious test.

Tech companies and local governments will continue to go head to head on local housing issues.

Prediction #1: The housing market will continue to cool

Over the first half of 2019, home-price growth will stay slow. Our forecasts have growth settling around 3 percent, would be the slowest growth we’ve seen in .

As recently as the first half of this year, prices were still growing 7 percent, and price growth has reliably exceeded 5% since the start of 2015.

There’s quite a bit of uncertainty around our price forecast; there is a real chance prices could fall below 2018 levels, putting up negative growth for the first time since 2011.

Sellers will have to adjust their price expectations as grapple with rising mortgage rates and already-high home prices.

Metros that saw the most price growth in the first half of 2018 will experience the biggest slowdowns in price growth in the first half of 2019.

Seattle, San Francisco, San Jose, Portland, San Diego, Los Angeles, Denver, and Honolulu a few of the metros where we expect demand to cool the most.

“A few weeks ago I helped my home-buying customers get a bid accepted that would have gone straight to the bottom of a pile of offers earlier this year,” said San Francisco Redfin agent Anna Coles.

“The offer for a house in desirable Parkside was below price and included a financing contingency, allows the to out of the contract without forfeiting their earnest money deposit on the off-chance their loan doesn’t get approved.

The norm for the past two-plus had been that had to waive standard protections like this in for a seller to consider their offer, but this is just sign that buyers may face competition heading into 2019.”

On the flip side, we expect home prices to continue to grow a strong pace in a handful of small, affordable, inland markets like Buffalo, Rochester, and Greensboro, where the market is still heating up.

We’re going into 2019 with a 5 percent greater supply of homes for sale than we had to go into 2018, is the highest growth we’ve seen since September 2015. But home sales were down 8 percent since last year in November.

A still-growing economy and increased to credit will support more home demand, but higher interest rates will home-buying more expensive, so it’s to say home sales will stay down or rebound next year.

Prediction #2: Homeownership rates will continue to rise

total home sales go up or down, more will be sold to people who plan to live in the home as opposed to , which will cause the homeownership rate to rise.

Indeed, during 2019, homebuyers will enjoy more inventory and competition from speculators and house-flippers, which will lead to more people enjoying the benefits of homeownership.

Homeownership has been consistently growing from its post-recession valley of 63 percent in 2016 to above 64 percent this year. We predict the homeownership rate will grow more rapidly in 2019.

Prediction #3: It will cost more to borrow, but more people will have to credit for home-buying

Homebuyers have already seen mortgage interest rates increase in 2018, and the Fed’s most recent comments indicate that it will continue to raise rates twice or more in 2019, which will push the average 30-year fixed mortgage rate up to about 5.5 percent by the end of the new year.

This increase from the sub-5 percent where rates have been hovering in recent months would mean about a $100 increase in monthly mortgage payments on a $300,000 home by the end of 2019.

Lenders will also feel the effects of rising rates, which will increase their costs of lending and dampen demand for their .

This will motivate lenders to expand their customer base to low-income borrowers and first-time homebuyers. But of course, lenders will charge more for these loans–both to cover the risk of lending to borrowers with -than-perfect credit and to cover their own costs of borrowing.

Prediction #4: A cooling housing market will dampen growth only slightly

In 2018, growth was the strongest it has been since early 2015. However, residential , which includes money spent on construction, renovations, and real estate commissions, and typically makes up about 15 to 18 percent of activity, declined slightly in 2018.

For 2019, the economy will most likely grow, but a cooler housing market will contribute less to the overall economy. Even if residential were to fall by 10 percent.

An atypical situation which has only happened three times in the last 40 years, total economic activity would be impacted by 1 to 2 percent. That isn’t enough to cause a recession as long as the rest of the economy keeps growing.

From that perspective, there could be spillovers from the cooldown in the housing market to consumer spending.

Moreover, when homeowners see sitting on the market and sellers dropping their prices, they feel less wealthy. Rising interest rates will also impact more than just home sales.

Meanwhile, it will be more expensive to finance a car loan, take on credit , or refinance a mortgage to take out equity, which will also weaken consumer spending.

Prediction #5: Fewer homes will be built, but more builders will focus on starter homes

In 2019, homebuilders will be more cautious about building during a cooling market and focus on building starter homes that easier to sell than luxury homes.

We have already seen the per-unit value of single-family residential building permits flatten, and we predict per-unit values of building permits will decline in 2019.

Another factor in 2019 will be low unemployment, which will finally cause wages to rise for low-income workers. This will impact both the supply of and demand for housing.

On the supply side, higher labor costs will limit the of homes built. Meanwhile, higher wages will be a boon to demand starter-homes among working-class Americans.

“When we decided to plan our first new construction , we found a niche in the $250,000 price in Dallas, where there is a deal of activity among national and local builders.

Because almost all of it focused on the high end,” said Pushban Rajaiyan, the lead on Brentwood Court by Havendale Homes, a townhome community now available for pre-sale.

“It was important to us to offer homes built with high- materials but for an affordable price and in an area where can enjoy nearby amenities and short commutes.

Just in the past few months, we’ve already begun to see other builders catch on to this unmet in the market, with other affordable, starter-home options coming available to local buyers soon.”

Prediction #6: Institutional buying faces its first serious test

Nevertheless, if home-buying demand falters due to higher interest rates and stock-market volatility. Meanwhile, the toward instant offers from institutional homebuyers could face its first serious test, a test of pricing algorithms as as companies’ appetite for risk.

Armed with billions in capital, competitors from Open door to RedfinNow to Zillow to Offroad to Knock have been vying with one another to buy homes from and then sell those properties a profit, with i-buyers’ combined share of U.S. home sales growing rapidly.

The question asking is instant offers will now be significantly lower, to compensate institutional buyers for the market’s recent uncertainty and homeowners will accept the offers, just to avoid those same uncertainties themselves.

Institutional buyers who made money from nearly every sale in a rising market with low-interest rates could start to face losses, or may demonstrate more discipline than other housing investors. In 2019, we’ll find out.

If i-buying works in a bear market as well as it has in a bull market, instant offers could become a major, permanent sector within the real estate economy. If it doesn’t, a lot of money is going to sink into the sand.

Prediction #7: Tech and will go head-to-head on housing

As we know, cities have been struggling with the -edged sword of tech-company-driven prosperity and inequality.

Tech companies bring skilled workers to cities and pay them handsomely.

This is why 238 cities vied for Amazon’s HQ2. But, shortly after the HQ2s were announced, residents of Long Island City began protesting, advocating for more housing investment to avoid displacing existing .

Crystal City has planned ahead with 4,000 new housing units, but plans to hire 25,000 people there. Growing cities will have to start building more housing now if they don’t want to face the affordability.

At the same time, homelessness problems that established tech hubs like Seattle and San Francisco are currently facing.

This article reflects the beliefs of our blogging team about the overall housing market. If you would like to find out which of our predictions in this article come true, and which predictions turn out to be incorrect, visit our real estate page