The U.S. housing market is back on its feet, aided by rising home prices, steady job growth and fewer troubled loans.
More U.S. homeowners are also keeping up with their mortgage payments. March was the 42nd straight month where U.S. foreclosure activity dropped from year-ago levels.
Each year, it seems the housing market takes on a different tone – and whether it’s going to be a sellers’ market with inflated prices and bidding wars, or a buyers’ market with tons of choices and low prices – there’s no denying that the 2014 spring housing season is upon us. So what does it have in store? Well, if you’re thinking of listing your home, that’s an important question.
Here are 6 market insights that will give you a head start!
When buyers hear the term “short sale,” they typically think about distressed sellers and good deals — especially in markets where prices have ticked upwards. But the word “sale” can be misleading. In fact, many real estate agents have renamed “short sales” as “long-and-drawn-out sales.” Here’s why short sales often take a long time to complete.
Nearly every city in the U.S. is expected to see economic growth in 2014, according to a new report by the U.S. Conference of Mayors. The city expected to lead the country in economic growth and job gains is Naples, Fla.
Other large cities expected to see big growth this year: Raleigh, N.C.; Atlanta; and Austin, Texas, according to the report, which was conducted by IHS Global Insight.
The bursting of the housing bubble didn’t deter affluent buyers for long.
After the recession, the market for large, expensive homes slowed sharply. Yet despite the bursting of the housing bubble, the ensuing recession and the slow recovery, buyers have not abandoned luxury homes. It turns out that they just took a break. In July 2013, sales of homes costing more than $1 million were up 46.6 percent from the previous July. When it comes to new homes, bigger is again better.
Though the housing market continues its halting recovery, thousands of homeowners are still struggling in the aftermath of the worst financial collapse since the Great Depression. Even as the overall foreclosure level has retreated to pre-2006 levels, the average length of cases already in the pipeline has increased.
But that may be changing.
The housing recovery is expected to remain strong in the new year, driven by economic growth and an improving employment picture, economists say.
In fact, job growth likely will be one key to driving housing growth in the new year. An estimated 2 million or more jobs will be created in 2014, predicts Lawrence Yun, National Association of REALTORS(R)’ chief economist.
As employment picks up, greater demand for housing is expected to occur and a surge in homebuilding activity. Celia Chen, housing economist at Moody’s Analytic, predicts a “homebuilding boom” in 2014 that will spark even more jobs — from construction workers to manufacturers — and bring about greater demand for housing overall.
Investments in single-family homes for rental properties will remain an attractive venture in many markets in the new year, says Ingo Winzer, president of Local Market Monitor. Winzer notes that Texas and Oklahoma offer some of the best bets “with their low unemployment rates and ability to profit for years from new shale oil and gas development.”
Local Market Monitor and HomeVestors, an investment company that brands itself “We buy ugly houses,” named the following top 10 housing markets for investing in single-family homes for 2014. All of these markets have posted strong appreciation in the past year but are still underpriced by up to 28 percent.
Housing foreclosure authorities LoanSafe.org and YouWalkAway.com have created a new website to help people re-enter the housing market after having been through a previous foreclosure. The website is called AfterForeclosure.com and helps those most affected by the housing crisis take charge of their financial future and own their own home again.
Based on a poll of their combined members, LoanSafe.org and AfterForeclosure.com are confident that these potential buyers will make 2014 the year of the “boomerang” buyer.
Changes in lending guidelines and population shifts make these buyers essential to the recovery of the housing market. Jon Maddux, co-founder of AfterForeclosure.com says: “Alienating this large and growing pool of potential buyers does not bode well for the market in an environment where natural housing advancement has been largely disrupted.”
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