Travis Cadman: Forecasting Real Estate’s Future in 2020


Real estate investors in Alberta, Canada, would naturally love to have crystal balls that tell them what will happen in the next three, six, nine, or 12 months. The truth is, though, that there is no surefire way to know exactly what will happen in the real estate industry in the near term. Still, leading industry experts like Travis Cadman of Investar USA are known to provide consistently reliable real estate industry outlooks from year to year. Here is a glimpse at what Cadman says will likely happen in 2020.

First, the economy in North America, cities is as strong as it has ever been compared with years past. However, according to Cadman, purchasing power in the residential real estate industry is expected to take a hit next year. The reason for this is that mortgage rates. When the mortgage interest rate rises, home sales have a tendency to slow down, as the rising rate decreases an individual’s ability to obtain a mortgage by a whopping 7%. On the flip side, if the mortgage rate drops, home sales will likely improve.

One segment of the residential real estate market that deserves special attention is the luxury home market, which forecasters have underappreciated. According to Cadman, a quarter of demand in this market, also known as the move-up market, is likely to disappear if the mortgage rate surpasses 4.5%.
However, if millennials have their way, they generally wouldn’t buy homes anyway. For many people in the age range of 23 years to 38 years, buying a home simply isn’t a viable option because they already have a great deal of student debt. Therefore, they must resort to renting homes. Still, renting a home or apartment unit offers the benefit of saving them on home maintenance costs and putting them in close proximity to desirable amenities.

The future of real estate may not be set in stone. However, according to Cadman, being vigilant of market changes and remaining flexible in how you respond to them will help you to absorb anything that the market throws your way in 2020.

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