Housing Market Slowing Down? Most Signs Actually Point to an Uptick

While some recent economic reports have indicated a slowing down in the housing market, the majority of indicators paint a rosier picture for home buyers and sellers alike. Here are some of the reasons to remain optimistic:

·        Home prices are expected to rebound up to 6% in 2014.  We’re slowly returning to a typical housing market where price increases of about 4-5% per year are more the norm and much less the exception. Since we’re at the end of the market recovery, there’s a good chance to see price hikes of up to 6% in some neighborhoods.

·        More new homes under construction. Some analysts see a possible hike of 20% in home building across the nation which in turns means more inventory to address pent-up buyer demand plus more jobs for those itching to get back to work. While some may fear a glut of homes flooding the market the truth is that since we stand at such low levels of inventory, the new properties will be easily absorbed.

·        Empty Nesting, Part 2.  Baby boomers became the proverbial “empty nesters” when their kids went off to college. With the downturn in the economy of the past few years, many of those same kids moved back home. Now that the job market has turned the corner, more adult children are able to leave their parents’ homes (again) and enter the house-hunting search for the first time, providing yet another incentive for sellers to market their homes. Bottom line? More homes, more buyers, more upward movement in the housing market.

·        Interest rates will remain stable in 2014. Thanks in large part to the Federal Reserve’s efforts to stabilize our economy, mortgage interest rates have only bumped up a bit. The thinking is that rates will stay below under 5.5% at least until 2015. And those levels will keep home buying affordable for many.

The activity in the American housing market in the next few months will demonstrate that the rebound is truly a thing of the past. More home buyers will find themselves willing, able and finally ready to purchase their first homes. And that’s a trend that can only motivate homeowners to get off the proverbial fence and put their homes on the market.

For more insights on the current real estate market or to find out how much your own home is worth, contact me through my website (GoHomeWithMichael.com) or call me directly at (617) 899-3162.