2014 real estate market predictions – Real Estate Insider Magazine
A hard-fought march to recovery has kept buyers and sellers wary of the real estate market, and recent predictions for 2014 suggest that experts believe Realtors, buyers, and investors may need to exercise some caution in the New Year. The chief economist at the National Association of Realtors (NAR), Lawrence Yun, said his organization believed that existing home sales would not rise even though home prices would jump about 6 percent.
Prices rise, sales flat
One reason why Yun suggests sales might be flat is the expected rise in interest rates. Higher interest rates could cause some investors and buyers to hold off making a purchase until the return of more favorable conditions. The jump in interest rates is a projection based upon what the federal government may do with rates in 2015, which would influence rate jumps in 2014.
Some housing markets thrive
Despite the mood of caution hovering over the industry, there are a number of areas around the country that should continue to exhibit growth and increases in new housing starts. Using the Case-Shiller index, experts believe that some of the healthiest housing markets in 2014 will be Washington state’s Bremerton-Silverdale metro area and the Bend, Oregon, metro area. Likewise, the Detroit metro area and Napa Valley, Calif., should remain healthy through 2014.
First-time buyers squeezed
According to statistics cited at a gathering of California Realtors, expert Bruce Norris said the market would remain tough for first-time homebuyers. New buyers in the mid-1990s made up around half of the sales of new homes. Today those numbers have sunk to around 28 percent, which means veteran buyers with cash are squeezing out first-timers. Additionally, mortgage approval remains low, with lenders continuing to operate cautiously.
No agreement on home appreciation
One area where real estate experts can’t seem to agree is in expected home appreciation and depreciation numbers for 2014. Recent surveys conducted by the real estate website Zillow suggest that some experts believe there will be mild appreciation of home values while others predict homes will depreciate instead.
The forecasts for 2014 real estate market performance run the gamut from pessimistic to guardedly optimistic. Few experts believe the market is going to experience a meteoric rise in 2014, but most surveys and forecasts agree that 2014 should offer measured growth at a minimum.
Post Author: andyc.
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