Analyst Opinion
The Residential Real Estate market in United States is experiencing significant developments and trends. Customer preferences:
Trends in the market:
One major trend in the United States residential real estate market is the rise of suburban living. Many people are moving away from densely populated urban areas and are seeking larger homes with more outdoor space in suburban communities. This shift is driven by factors such as the desire for more space, lower housing costs, and the ability to work remotely. As a result, suburban real estate markets are experiencing increased demand and rising prices. Another trend is the increased popularity of second homes and vacation properties. With the rise of remote work and the ability to work from anywhere, more individuals are purchasing second homes in desirable vacation destinations. This trend is driven by the desire for a change of scenery, the ability to generate rental income, and the potential for long-term investment appreciation.Local special circ*mstances:
Certain cities in the United States, such as San Francisco and New York City, have unique local circ*mstances that impact the residential real estate market. These cities have limited land availability and high population densities, leading to high demand and limited supply of housing. As a result, prices in these cities tend to be significantly higher compared to other regions in the country. Additionally, these cities have a strong rental market, with a large percentage of the population renting rather than owning homes.Underlying macroeconomic factors:
Several macroeconomic factors are influencing the development of the residential real estate market in the United States. Low mortgage interest rates have made homeownership more affordable and have encouraged individuals to enter the housing market. Additionally, the strong performance of the stock market and overall economic growth have increased consumer confidence and spending power, leading to increased demand for homes. Overall, the residential real estate market in the United States is being shaped by customer preferences for sustainable and flexible homes, the trend towards suburban living, the popularity of second homes, and local special circ*mstances in certain cities. These trends are being supported by underlying macroeconomic factors such as low interest rates and a strong economy.Methodology
Data coverage:
Figures are based on total and average value of residential real estate, residential estate transactions and leases.
Modeling approach:
Market size is determined by a combined top-down and bottom-up approach. We use national statistics, international organizations, and industry associations to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country specific industry associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita.
Forecasts:
We use a variety of forecasting techniques, depending on the behavior of the market, for instance, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.
Additional Notes:
Data is modeled using current exchange rates. The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.
