As the year begins, the U.S. housing market doesn’t look very bright. Demand will likely stay depressed through 2019: Supply shortages are keeping prices high, especially in gateway cities where much of the job growth is occurring. Add to that higher interest rates, which are keeping existing homeowners from moving up the property ladder.
However, demand could get a bump from millennials looking to move from renting to owning their homes, and in markets like Atlanta where the number of new homes is rising. “It’s not going to be a great year for the housing market—[prices are] way over the market peak,” said Wharton real estate and finance professor Susan Wachter, who is also co-director of the Penn Institute for Urban Research. “What’s going to keep this market growing are millennials and the affordable Southeast.”
Wachter and real estate professor Benjamin Keys discuss home ownership versus rent, interest rates, and a “buyer’s strike” at the high-end housing market for the “2019: A Look Ahead” series.
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