Housing prediction for 2013: Prices will rise
By Diana Olick | CNBC.com – Tue, Dec 11, 2012 7:21 PM EST
[Yahoo! Homes editor’s note: CNBC is running a series called “Predictions
2013.” This CNBC real estate reporter Diana Olick’s forecast. Check Olick’s
2012 scorecard to see how her forecast last year measured up.]
Home prices will continue to rise, anywhere from 5 to 7 percent in
2013 from 2012.
These prices will be driven by continued competition among investors in the
distressed market, as well as a return to the market of organic move-up buyers. A
lack of supply in some local markets could push prices there even higher, but the
concern is that prices would rise faster than incomes, which could leave some
potential buyers on the sidelines.
Mortgage availability will be further curtailed by new regulations
coming out of Dodd-Frank.
Rules governing risk retention and a borrower’s ability to repay a loan have yet to be released, but mortgage bankers are
already warning they could make loans more expensive. Mortgage rates will likely rise off their historic lows, but not
Apartment rents will stay elevated and vacancies low despite the improvement in the housing market.
First-time home buyers are still having trouble returning to the home buying market, despite rising household formation.
With lenders requiring higher down payments and complete documentation, these buyers who usually make up over 40
percent of the market are at barely one third of home sales. We will only see the tide turner with far more robust job creation.
Mortgage delinquencies and foreclosures will remain elevated, but continued principal reduction
modifications as well as a high level of short sales will alleviate much of the distress.
Foreclosure sales will continue, but the banks are unlikely to flood the market with bank-owned properties, as they have no
desire to put downward pressure on prices.
As home prices continue to rise, more borrowers will come up from underwater.
This gain in home equity will help to fuel the renovation market and benefit remodeling retailers like Home Depot, Lowes
***Enormous caveat: If we go over the fiscal cliff, these predictions are all null and void.
END OF ARTICLE…
We are currently seeing some price increases in the Telluride real estate market area by area and complex, by complex. Telluride properties in all segments have hit bottom and the higher quality inventory (especially Mountain Village & Telluride homes) are showing the most strength. Many segments of the Telluride real estate market are becoming picked over, so I have been recommending to my buyer clients to take a serious look at a purchase before all of the good inventory of Telluride homes and condos is any thinner, or before we fully transition into a seller’s market, which is not too far off. While rates are low and inventory is still good, this is the time to seize the opportunity at hand. Telluride real estate represents a solid tangible asset for your portfolio that provides an incredible lifestyle and financial investment for you and your family, for generations to come.
Contact Broker, Adam Black of Telluride Properties to help you find your dream home in Telluride! – ABtelluride@gmail.com / 970.729.0568 – c