Alan Nevin, a leading economist based out of San Diego shared with Melissa Sofia, broker/owner of The Avenue HC, his predictions on our financial outlook.
We are currently entering the 8th year of a Recovery Cycle, (there are 4 different economic cycles). 8 years is an exceedingly long cycle of recovery! Yet, whether you like Trump or hate Trump, one thing we can agree on is that he wants to protect the interests of his own pocketbook- which as we know, is heavy into real estate.
So what does that mean for us?
- With this long cycle of recovery, many people have been expecting and waiting for a dip. With all of the recent talk of policies such as deregulation in the financial sector, personal and corporate tax cuts, increased spending in infrastructure and defense, economists think that trump is set to grow the economy. Meaning the price of housing will continue to rise, but more slowly.
- Even though the interest rate is also slowly on the rise, the upward movement of our economy paired with our low housing inventory in CA will give us at least another 3 years of prices heading upwards.
- Not only are interest rates and home prices going to slowly rise, but also rent prices in Southern California. This will absolutely take many first time home owners off the fence and into home ownership. If you're waiting to buy, you shouldn't- there is still equity to be made!
- So what should Millenials and first time home owners buy? Easy answer: homes that will increase in value. These homes tend to be in neighborhoods that are tied to a great school district, that attract investors, and also feature commercial development of hot spot eateries, shopping and entertainment.
For San Diego specifically, Melissa suggests these areas: North Park, Hillcrest, Downtown, around the Poway unified school district and Carlsbad /Encinitas.