Dear Consultant: Given so many headwinds, what will drive housing demand in the near term?

by: Lesley Deutch

Economic headwinds—including the possibility of increasing mortgage rates, a decrease in labor given the immigration crackdown, and possible increases in costs of imported items via tariffs—have slowed housing demand nationwide.

JBREC’s consultants have seen a slowdown. Kevin Cody?noticed decreasing sales in Charlotte, with most agents blaming seasonality. In Atlanta,?Karen Albright?observed that the entry-level and move-up markets have been slower, with builders having to boost incentives.

However, the concerns mentioned above are factors that impact the cost of housing, not demand.?James Penner?has seen demand for housing continue despite the increased headwinds.

Our consultants remain optimistic about finding opportunities in the current housing market.?

Buyers seeking affordability?

Zak Nyberg is seeing increased demand in Florida markets like Melbourne, Port St. Lucie, and Ocala as people move from high-cost to more affordable areas. Jeff Kottmeier has seen the same trend in the Northeast, with prospective buyers heading to Delaware.

Scott Wild has noticed strong demand in Southern California for homes designed for multi-generational living. Combining households with extended family members is the only way many can make their monthly housing costs work.

Follow the jobs? ?

Oliver Radvin commented that reshoring* and industrial growth in the Southeast and Florida have been catalysts for housing demand, creating new jobs in manufacturing, logistics, and tech industries.?

Demographic changes?? ?

As?Chris Dorociak?says, “Life happens, and demographics can impact housing needs more than macroeconomic conditions. Children, aging parents, and divorce are demographic shifts that translate to new housing.”

Builder and agent expertise?

Annie Radecki expects that agents who know how to sell and builders who can adjust prices if they need to will outperform in the current environment.?

Are you interested in learning more about near-term or long-term housing demands in your market or for your project? Reach out to our consulting team.

*Reshoring is the practice of bringing manufacturing and services back to the US from overseas.