Four Housing Predictions for 2013

I hope you’ve all had a happy new year so far. As I’ve been looking ahead to what 2013 will hold for the real estate market and how we at J. P. King will adapt to it, I’ve found more reasons to be optimistic than I have in recent years. Happy New Year to those of us in the real estate business, right?

The information I’ve studied certainly coincide with my personal experiences so far, and I wanted to share some of those things with you.

There are fewer residential properties available. 

Less inventory isn’t a bad thing, in this case. I’ve encountered buyers that are overwhelmed with the inventory we’ve had in recent years, which hindered their buying process. The best sign of less inventory is obvious: Our economy is beginning to heal. A recent report by CoreLogic said the number of homes in “shadow inventory” has dropped over 300,000 in the past year. Fewer homes on the market mean fewer foreclosures and higher prices for those homes.

Home prices will rise. 

Like I touched on a moment ago, I do think home prices will rise this year. Many of the reports from surveyors and economists I’m seeing agree that prices will rise anywhere from 3% to 3.5%. That’s great news.

Fewer buyers are driven by low rates. 

Again going back to the first point, buyers are actually more driven by the increasingly-limited inventory than they are the low interest rates. Since most buyers are confident interest rates will stay low for the next few years, it’s not a motivator to buy right now. A survey I saw said it’s the decreasing availability of homes for sale that push a buyer to purchase a home now. This will be the first year that those low interest rates haven’t been the top motivator.

Buyers aren’t as concerned about the economy. 

That’s a refreshing change of pace on so many levels. The economy and changing taxes are certainly still a concern for many, but it’s the rising prices of homes themselves that buyers are considering in their purchase decisions.

Overall, I think 2013 will continue to bring stability for the economy and the housing market. While the overwhelming buyers’ market is in the early stages of diminishing, the strengthening economy behind it is great news for all of us.

What do you predict from the real estate market this year? Do you agree or disagree with any of the points above?

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~ by Craig King on January 22, 2013.

One Response to “Four Housing Predictions for 2013”

  1. Great post. Thanks for your comments

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