7 Predictions for the Fall 2016 Real Estate Market

by Carson BuckSeptember 5, 2016

What to Expect From the Real Estate Market in the Fall of 2016

Every season, the real estate market trends seem to change. As we enter the fall of 2016, what can you expect to happen to the real estate market? How are prices going to be affected by the presidential election? What should potential buyers be keeping an eye out for?

This article presents 7 key predictiond as we take a look at the state of the real estate market for the fall, and anticipate what buyers and sellers can expect during the latter part of 2016.

fall 2016 real estate market trends

1. Mortgage Rates Will Start Climbing

Mortgage rates have been low for a while now, but that is looking to change as we enter the fall season. A new president means uncertainty and – whoever wins – it looks like the areas that will be hit most by the political fallout will be those with higher home prices.

2. The Market Will Make a Gradual Return to Normal

For more than 15 years, the real estate market has been in a serious state of flux. But the deeper we head into 2016, the more “normal” and balanced it will become. This means that new home construction and distressed sales will trend closer to their historic levels than they have for years.

3. Millennials Will Drive the Fall Market

The fall traditionally sees a slowdown of sales, but in 2016, Millennials will finally start making a difference as more and more of them start buying their first homes. You can also expect financially recovering Generation Xers and aging Baby Boomers to also make a big impact in the home buying field this fall.

4. New Home Builders Will Start Catering to Entry-Level Buyers

New home builders have traditionally produced larger and more affluent homes for the luxury home buyer, but higher home prices and land costs coupled with a reduction in labor forces has forced builders to start focusing on producing more affordable homes for the entry-level buyer sect.

fall 2016 real estate market trends

5. Rent Rates to Continue to Climb

Rent rates are climbing at a much faster pace than home prices. This is a trend that started in 2015 and it will be remaining steady through the fall of 2016 and beyond, as American households simply lack the creditworthiness, savings, and stable income that’s required by lenders to qualify for a mortgage these days.

6. Inventory Will Remain Tight

At the end of summer 2016, there were very few homes available for sale on the market compared to what’s normal for the “traditional” summer season. At the end of August, there were just 2.29 million homes on the market. That’s approximately 5.2 months’ worth of home sales. This is down by nearly 2% from August 2014. And this trend is going to continue into fall.

7. Fewer Cash Buyers Will Compete in the Market

In fall of 2016, you can expect cash buyers, or those who are buying homes for investment purposes, to start bowing out of the market. The reason is because the number of foreclosed homes is starting to drop. This will enable those looking to buy homes to do so with much less competition.


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About The Author
Carson Buck
Carson is a real estate agent based out of Phoenix, Arizona. Carson loves data and market research, and how readily available it is in today's world. He is passionate about interpreting these insights to help his clients find and buy their perfect home. Carson got into the real estate industry because he loves the feeling of handing over the keys to a new home to happy clients. In his free time, he works on his backyard bonsai garden and spends time with his wife, Julia.