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2013-12-17 10:49:07
My Outlook Past and the Present 2013

A rise in the number of listed properties:

Abnormally low inventory levels boosted
prices throughout 2012 and part of 2013. However, inventories are beginning to rise.
The National Association of Realtors reported that inventory levels of unsold homes
rose in September from a year earlier, the first rise in inventory since 2011.

The release of shadow inventory:

In areas where foreclosures were the highest,like
Nevada, California and Florida, banks are now beginning to release more of their
foreclosures after holding them back for years in order to stabilize prices. Lower-priced
foreclosures, especially on homes built between 2001 and 2008, offer a much cheaper
alternative to buyers than new homes, even after factoring in the cost for repairs
and cosmetic improvements to the home.

Weak job creation:

Unemployment is still high at 7.3%, and many of the average monthly
jobs being created recently are merely part-time or service industry jobs with low
wages that are not conducive to growing home ownership. In fact, home ownership rates
have continued to decline in recent months. Some younger consumers are also
shunning
home ownership, and are inclined to view renting as a more flexible and
favorable life
style. Newer apartment complexes often cater to these consumers
whims with in-ground
pools, fitness rooms, bike trails, etc. People pay more to
have these benefits, but
seem unwilling to trade them for the lawn mower and backyard
barbecue lifestyle of
home ownership.

Rising interest rates:

The decline in housing stocks over the second half of 2013
is directly attributable to talk of the Fed Tapering its monthly purchases of bonds,
and the resultant rise in interest rates that it produced. While no set decision has
been reached regarding how and when the Fed will begin to taper off on its
purchases,
it would cause a sharp rise in interest rates in 2014. The one-two combination
of rising
rates and home prices could land a knock-out punch to home builder stocks.

Healthcare costs:

With the shaky roll out of the Affordable Care Act, there is a
great deal of uncertainty among consumers as to how much they will have to pay for health
insurance and medical costs. As young consumers in the 27 to 39 year
old age group begin
to pay more for health care, it will reduce the amount of money
available to them to
save for housing related down payments and closing costs.

 

 

 
Blog Archive
2018-08-03 11:35:57
August 2018 Newsletter

2015-01-29 14:07:03
Blog Feb 10,2015

2014-03-26 13:55:31
March up date

2013-12-17 10:49:07
My Outlook Past and the Present 2013


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