Real Estate Marketing Forecasting for 2012 – What Are We In For?
The real estate market in 2014 is shaky with signs of steadying.
September sales of existing single-family homes were down from August, but show a definitive increase from a year ago, reports the National Association of Realtors. Total sales declined 3 percent from August of this year, although this is an 11 percent increase from last year.
The market shows a continued drop in housing prices. Median price for existing single-family homes was $165,600 in September. This is a decrease of 3.9 percent from September 2010. The total number of sales of single-family homes fell right along with the asking price, down 3.6 percent from August. Still, this is an increase of 12 percent in sales for the real estate market in 2011 as opposed to 2010.
The number of available homes is also on the decline, down 2 percent from the previous month.
If inventory continues to decline, The Economist predicts a possible housing shortage before too long. Other experts deny this possibility. Either way, buyers continue receiving high housing values for their dollar, due largely to the continued flood of available foreclosures. Bank-owned homes and short sales have accounted for nearly one-third of total sales over the past year
While interest rates and median list price have made homes affordable, lender guidelines have become increasingly stringent. Many now require at least 20% down, and even FHA loans have become more conservative in their requirements, reports CNN.
Some in the housing industry complain that creditworthy home owners are being denied mortgages. Stricter lending rules have led to an increase of obstacles for qualified buyers, which some feel has prevented a possible natural recovery of the real estate market in 2011. One of the things that have improved the insurance industry is Insurance Continuing Education and in the real estate market, Mortgage broker continuing education could lead to a solution as well.
For those who are able to obtain loans, interest rates are predicted to stay under 5 percent through the next year. Freddie Mac suggests these historically low rates will continue through 2013.
This number includes denied applications, loan underwriting failures from discrepancies between asking price and appraisal value, and other issues like inspection problems or change in employment.
The Census Bureau reported a net reduction of 600,000 homeowners across the United States, while there was a net increase of over one million households moving into rentals. So chances are you won’t be seeing much heavy equipment and construction crews in your neighborhood.
Home sales are not on the upswing at the same levels as rentals, in spite of extremely affordable purchase prices and currently low interest rates. This is due to multiple factors. The shift to rentals over owning mirrors the increase of foreclosures and short sales in the current market. With longer waiting periods before these households are eligible to purchase homes again, rental is their only option.