Twin Cities Housing Market Predictions
Twin Cities Housing Market Predictions for 2014
Last year the Twin Cities Metro area saw the real estate market spiraling upward towards recovery.The hallmark was a competitive market with record low interest rates coupled with low prices and a sense of optimism bolstered by a firmer job market and a stronger economy.
Predictions for the 2014 Twin Cities Housing Market continue to be optimistic for continued growth, but at a more moderate pace than the previous year as the real estate market and the broader economy continues to improve. We can expect Minneapolis-St. Paul Metro home values to continue to rise from 4-6% in the coming year and although interest rates are on the upswing, they are still historically low and expected to bounce around between 4-5% for most of the remaining year. Foreclosure numbers continue to decline, and Minnesota with a low 7% foreclosure inventory, will contribute to sustainable home values. Almost 2 months into the year we see a stable housing market emerging as we head into the last month of the quarter. What trends are likely to emerge as we head into the spring thaw and what will that mean for buyers and sellers?
Good news for sellers
• Low inventory of property for sale, especially in the early part of the year, lead to increased home values
• As home prices continue to rise, more homeowners will emerge from the “underwater status” and be inspired to put their homes up for sale
• Inventories of existing homes for sale expected to remain tight
• Former homeowners who suffered foreclosure or short sales will be able to buy homes as they become eligible for financing
• The current market conditions are presently more favorable to sellers
Good news for buyers
• Continued low interest mortgage rates will make home ownership affordable
• A shift from a refinance driven mortgage market to one which will depend on purchase-
driven lending may make it easier for buyers to secure financing as lenders loosen up and show a little more flexibility
• Recovering home values will enable former “underwater” owners sell and purchase that move-up or dream home
• The expectation that fewer investors will be in the market will open up more possibilities for traditional home buyers
• Increased new construction
Whether you are in the market to buy or sell this is a good year to make your move. Economic indicators for Minnesota, including the lowest unemployment rates nationally and predicted job and economic growth will sustain the continued recovery of the housing market. The elements of low mortgage interest rates, good prices, fewer foreclosures, and availability of credit make this a good time to sell as well as inspire buyers that have been on the fence to come out of the wings and make that purchase of a home!