More buyers will enter housing market in 2017, but prices of new construction could spike due to Trump immigration policies. Bobbi Rebell reports.
Americans will buy more houses in 2017, even as renting becomes more affordable, says the latest housing market research from Zillow. Millenials - already the largest home buyer group - will continue to play a significant role in driving up that home ownership rate. Home prices will go up, in part because builders will likely have to pay workers more. Svenja Gudell, chief economist at Zillow: (SOUNDBITE) SVENJA GUDELL, CHIEF ECONOMIST, ZILLOW, (ENGLISH) SAYING: "As President-elect Trump takes office, and takes a harder stance on immigration policies, that builders will have to work much harder to attract talent and therefore have to raise wages. And some of those increases in their costs could be passed through to consumers, and they will have to anticipate spending more money on new homes next year than they did this year." Zillow's predictions come on the heels of data released on Tuesday showing U.S. existing home sales rose in October to their highest level in more than 9-1/2 years. Another data from last week showed a surge in housing starts. Mitch Roschelle of PwC: (SOUNDBITE) MITCH ROSCHELLE, PARTNER & NY BUSINESS DEVELOPMENT LEADER, PWC, (ENGLISH) SAYING: "The numbers coming out of the housing market at the end of the year, which is after traditional Spring - Summer selling season were actually very strong on seasonal basis, so, if you look at the supply and demand dynamics, and really health of the U.S. economy, it really suggests that 2017 should be a strong year for the housing market." Tuesday's solid housing data adds to strong reports on retail sales, the labor market, and manufacturing . All that suggesting that the U.S. economy continued to gain momentum early in the fourth quarter.