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 low-interest record rates coupled with low prices and a sense of optimism bolstered by a firmer job market and a more robust 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 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 will contribute to sustainable home values with a meager 7% foreclosure inventory. Almost two 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 occur as we run 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 a 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 homeownership 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 to 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 an excellent year to make your move. Minnesota's economic indicators, including the lowest unemployment rates nationally and predicted job and economic growth will sustain the housing market's continued recovery. The elements of low mortgage interest rates, reasonable prices, fewer foreclosures, and availability of credit make this an excellent 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!