In a national housing market operating on muted growth, New York may become a completely unremarkable player.
According to a Realtor.com analysis of the country’s top 100 metropolitan areas, New York (which in this case also includes Newark and Jersey City) may be lost to the middle of the pack next year.
It placed 23rd in the survey, just behind the Charlotte, Concordia and Gastonia areas of North and South Carolina and Oxnard, Thousand Oaks and Ventura in California.
The number one metropolitan area in the survey was Phoenix, Mesa and Scottsdale in Arizona, which is expected to post an increase of 5.94 percent in price and 7.24 percent in sales activity.
This was followed by Los Angeles, Long Beach and Anaheim in California, which is projected to have an increase of 6.9 percent in price and 6.03 percent in sales.
New York generated mixed projections for the coming year. It placed 11th in terms of sales volume and 59th in terms of price. For the coming year, the area is expected to grow by six percent in terms of sales activity. It outpaces the rest of the country when it comes to sales activity. For next year, national home sales are expected to grow by just 1.9 percent to 5.46 million deals. Meanwhile, home prices in New York are estimated to jump by four percent, in line with the 3.9 percent national average.
Realtor.com, which is owned by the National Association of Realtors, expects the country’s real estate market to slow down compared to the last two years. It also projects that the homeownership rate will grow to 63.5 percent, a 0.6 percent jump compared to this year’s total. The website based its analysis on year-end conditions that include 2.1 percent GDP growth, a 2.5 percent increase in the consumer price index and an unemployment rate drop to 4.7 percent.
Realtor.com expects the influx of first-time homebuyers to be milder than previously stated. “We don’t expect the outcome of the election to have a direct impact on the health of the housing market or economy as we close out 2016.
“However, the 40 basis points increase in rates in the days following the election has caused us to increase our interest rate prediction for next year,” said Jonathan Smoke, Realtor.com’s chief economist.
“With more than 95 percent of first-time home buyers dependent on financing their home purchase, and a majority of first-time buyers reporting one or more financial challenges, the uptick we’ve already seen may price some first-timers out of the market.”