2018 Real Estate Predictions

Wow, what a year 2017 has been!  I (and most other realtors) have been racing to keep up with a crazy fast real estate market and a housing supply shortage that has frustrated many anxious buyers.  The home prices in our area have been on a dizzying escalation, while the low interest rates entice many into the market.  The zany political climate makes some folks nervous, yet unemployment is lower, so is this the time to enter the real estate market?  I consulted my crystal ball (and some qualified experts) to consider the situation and make some 2018 real estate predictions.

2018 Crystal Ball

First – Kansas City Stats

According to Kansas City Regional Association of Realtors, in November:

  • Housing inventory was down 17.7 % versus 2016
  • There is only a 2.2 months supply of homes on the market
  • The average house sale price was $230,105
  • There were 3001 homes sold in November 2017

Now – The 2018 Real Estate Predictions

Mortgage Rates

Economists predict that mortgage rates will increase, but just how much is not clear.  One Zillow survey forecasted that rates on a 30-year fixed rate mortgage would increase to 4.5% by the end of 2018.  This is still a comfortable rate for buyers and low compared to historic averages.


While new housing starts are up, there will still be inventory shortages that will disappoint buyers.  These shortages can be credited to a myriad of factors:

  • Slow rate of home building over the past decade
  • Labor shortages in the home building trades
  • Large number of millennials entering the market
  • Sellers unwilling to list their house until they secure a contract on their next house
  • Seniors who decide to age in place due to a lack of retirement funds or desire to retire later
  • Limited number of build-able lots for new homes


Uncertainty about tax reform and rising interest rates may influence affordability in 2018.  Today’s tax bill  has many questioning how new regulations will affect home buying in their state.  This is especially concerning to buyers in expensive marketplaces like California and New York.  The mortgage interest deduction question is a serious one that will concern some buyers.  As a result of extreme student debt, many potential first-time buyers are forced to remain at home with parents while unable to afford rising home prices.  While the growth in home prices may more closely align with increases in income, rising interest rates may cut into the affordability factor for a period of time.

Millennials and First-Time Buyers

Millennials will monumentally impact the real estate landscape.  They are formidable not only by their numbers, but also due to their new take on living spaces and community.  They have their own perspective on where and how they live.  Many millennials are looking for more “European-style” communities that are walkable and enriched with services, shopping, farmers’ markets, great schools and dog parks.  Other forecasters believe that many millennials will want to reinvent the city centers.  Either way their potential buying power is monstrous.


There are a few new twists and turns that will be a part of 2018’s real estate landscape

  • Proposed reform of Freddie Mac and Fannie Mae
  • Accountants on your speed dial to answer the new Tax code questions
  • New technology including Bitcoin
  • New home design and remodel trends including multi-generational housing
  • Here comes Gen Z!

Check out the two following interesting posts about what’s trending and real estate predictions for 2018.  The first one is from Inman and the second is from Curbed.  I would love to hear what you think about 2018 and any trends you see coming our way.  Please give me a call, text or email.  I’m always ready to talk real estate and my prognostications.

I can’t really tell the future, but I do see good things coming!


Bob Myers

Bob Myers Properties
Community Focused, Architecturally Passionate, People Proven

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