Home price increase will slowdown in 2014….

The title of this post is not complete without the rest of the station, “but only after some increase…”. As per reports from analyst, home prices are poised to cool off and only increase less compared to 2013. Yes, my buyers will be happy to hear it but it will be little late in the game to jump in the wagon as the prices have almost getting to the peak.

Here is some snapshot of some analyst take on 2014 housing market,

Economists are predicting housing prices to continue to rise next year — but only at about half the rate that they did in 2013, Money Magazine reports. However, “for a sustainable recovery, you want to see more balance between buyers and sellers,” says David Stiff, chief economist at CoreLogic Case-Shiller.

Home sales will likely see modest growth next year, says Lawrence Yun, chief economist at the National Association of REALTORS® . Strict underwriting practices by lenders, rising interest rates, and tight inventories in many markets will moderate sales growth. NAR has predicted home sales of about 5.12 million for 2014, which is close to the same level forecasted for 2013.

Meanwhile, inventory levels are expected to see some improvement in 2014. In September, they rose 1.8 percent compared to a year earlier, according to NAR data. That marked the first increase in inventory levels since late 2011.

Still, expect 2014 to continue to be a seller’s market while inventory levels remain tight, analysts say.

Fewer distressed homes on the market also will likely mean investors will take a step back, leaving more room for home buyers to step in. Investors’ share of residential home purchases dropped from 23 percent earlier this year to 17 percent in September, according to the Campbell/Inside Mortgage Finance HousingPulse Tracking survey. But buyers will likely be greeted by higher mortgage rates. The 30-year fixed-rate mortgage is expected to increase from a 4.5 percent average to more than 5 percent in the new year.

Also, buyers will still face tight underwriting standards. While real estate professionals are reporting that qualifying for a loan is getting easier, the speed of processing the loan has not improved. Virginia real estate professional Rob Wittman told Money Magazine that buyers might want to consider using local lenders with ties to nearby appraisers for faster closings.

And sellers shouldn’t underestimate buyers in the new year, either. “Buyers are smart these days — they know where the market is and know that rates are higher. They aren’t going to bite on a list price above recent comparables,” says Sara Fischer, an agent with San Diego-based Redfin.

Houston might be little bit different since the job market is still good and expected to grow more compared to this year. It is expected to have continuous inflow of people from other states which will continue to feed the real estate market demand. Demand is expected to be either same as this year but how many people really willing or qualify to buy house would determine the supply crunch. If it’s slows down, you expect to see decent inventory in both resale and new home then there is good chance for price stabilization. It’s all up in the air but let’s hope for a great year like 2013.

About Vijaianand Thirnageswaram

I am a Proud Realtor of Texas, trying to guide and help clients to find their dream home and educate them to buy them for right price. I am also a Candidate for CFP who has more financial knowledge which allows me share and educate clients in any financial decision making process.

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