After years of extreme instability post the housing crash of 2006/2007, the year 2015 turned out to be a year of rapid growth for the real estate market. With the market beginning to balance, inexperienced observers may conclude that 2016 will pale in comparison. Entrepreneur and property developer Boris Mizhen, however, is predicting that this is just one of many positive trends to expect this year.
Mizhen explains that this change in the real estate market is not just an excellent trend, but it acts as the basis for many other optimistic developments we can anticipate in 2016. The housing bubble and its eventual collapse can be attributed to unrealistic and wildly variable values (irresponsible lending being another major factor). In contrast, this stabilization, as opposed to another heady climb, points to a balanced and healthy real estate trend. While prices will rise and new construction is a factor, these will occur at normal rates. Distress sales, which in large numbers can throw the market into chaos, will also be less of a factor. Boris Mizhen reveals that this balanced market will result in a wider set of housing options. “This is ideal,” he explains, “because many different types of buyers will look for homes that suit them.”
The arrival of this real estate shift comes at an opportune time: currently, different generations are reaching stages in their life where buying new homes is a priority. “Millennials are expected to make up the largest portion of home buyers in 2016,” Mizhen notes. “Higher income will allow them to purchase either starter homes or larger second homes to accommodate growing families.” At the same time, younger Gen X’ers (about 35 – 44 years old) reach a maintainable income. Further sustained by having recently rebounded from the financial crisis, they will be seeking larger houses in neighborhoods they find more desirable. Older individuals and couples, meanwhile, will search for new housing – often smaller, newly constructed homes or ones in new locales. “As you can see,” Mizhen explains, “there will be a shuffle in housing among younger purchasers. New construction will find buyers both across this demographic and an older one which is approaching retirement.”
To mirror this opportune timing, the financial realities of the market will make buying particularly attractive. “The slowest portion of the rebound has been starter home, single family type construction,” Mizhen explains. “However, in 2016 we can expect to see builders move away from their focus on luxury homes and rise in more affordable products.” Another potentially promising trend is the rise in home prices being less than the increase in already costly rental rates. For this trend to be optimized, affordable housing, and accessible but responsible lending, must become even more widely available to allow the majority of renting households to make the jump to ownership.
Boris Mizhen is an entrepreneur, property developer and business strategist based in New York City. Following his initial success providing groundbreaking marketing services for a wide variety of clients, he entered the real estate field where he owns and manages dozens of successful properties across the North Eastern United States. His passion for buying and improving housing for people of differing economic backgrounds parallels his love for charitable work, including the Jewish Foundation of Greater New Haven and Chabad of the Shoreline – for whose festival he has acted as the primary sponsors for a decade.
Boris Mizhen — Establishes the Jacob Fund to Provide Food for People in Need: http://www.reuters.com/article/idUSnMKW3vV5ca+1c8+MKW20151114
Boris Mizhen — Explains Shift to Online Shopping During Holiday Season: http://finance.yahoo.com/news/boris-mizhen-explains-shift-online-184831411.html