2013 Housing Market Outlook

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My realtor who helped with buying my home a few years ago occasionally sends me newsletters on the state of the US housing market. For the most part this is marketing material looking for referrals and to keep her in mind if when I decide to sell or upgrade. But a recent newsletter she sent me had an interesting graphic which provides an early prediction into the 2013 housing market. Interesting points to note:

Nearly 75% people think it is a good time to buy (as opposed to 15% who think it is a good time to sell). From anecdotal evidence, I think this is more like 50%, but the trend is positive. No doubt. Rental investments are also getting hot as folks with cash would rather invest in the safety of real estate as opposed to an already frothy stock market that could coming crashing down fast any day. As the housing crisis fades into memory, it seems people would rather put their cash into tangible assets and let their 401(k) and IRA plans be the vehicle they use for investing in equity markets.

Home prices are rising. I run my house through Zillow about once a month to get an idea of how much it has gone up or down in value. The site also provides information on homes that have been sold or new homes that have come up for sale in my neighborhood. These actual home comparables or comps are generally a better guide to home values than model generated ones that most realty sites provide.  Either way, model or via comp values, I have definitely seen a rise in home prices and a general increase in sale prices of homes in my area. Talking to family and friends in other parts of the country this is a similar trend. Even homes in Florida and California, hit hardest during the housing slump,  are going up in value. The main exception is housing markets in the mid-west which is still struggling.

2013 housing market

2013 housing market

 

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Mark Campbell February 26, 2013 at 6:38 pm

While housing prices are poised to rise in the near term, there exists some problems years down the road. Interest rates are poised to return to more historical averages. I can’t say when they will rise, or to what level they will rise. With interest rates is the 3% ranges these days there will be pressure on home prices as we move into a 5-6% interest ranges. Although it is a GREAT time to purchase a house today, folks can not expect to get great appreciation of home prices as prior generations.

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