The housing market is stronger and more sustainable than it was a year ago. It is worthwhile to review estimations for the 2014 calendar year:
- According to Lawrence Yun, chief economist at the National Association of Realtors, interest rates will climb to 5.4% by the end of 2014. However, Yun said that any buyer hesitation over higher rates may be offset by strengthening job growth and more lenient mortgage-qualification standards. Also, while existing home sales will remain flat, sales of newly constructed homes will increase by 18.5%. His projections also included a 25% increase in new-home construction starts.
- Experts from the Urban Land Institute recently issued their ‘Emerging Trends in Real Estate’ report, which said that the real estate recovery will gain momentum in 2014. The report predicted Millennials (according to Pew Research, those individuals born between 1977 and 1992) will continue to choose urban environments over suburban ones. The report also suggested that more Baby Boomers will sell their homes and move to urban locations with the same amenities desired by Millennials. Additionally, markets in Texas (Austin, Dallas, and Houston) and California (Orange County, San Francisco, and San Jose), as well as Miami, Seattle, Boston, and Portland (Oregon) are expected to provide the best prospects for real estate investors and developers.
- Zillow published results from its most recent Home Price Expectation Survey, which asks professional forecasters to provide expectations for housing market growth. This edition compiled 108 responses (including those from economists, market & investment researchers, and real estate experts). The average prediction for annual home value appreciation in 2014 was 4.3% with a low of 5% depreciation and a high of 8.4% appreciation. For mor information, visit www.zillow.com/blog/research.
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