Happy New Year
January is a time to look back and look forward. As I reflect on real estate in 2014, I can say that it was a good year. Home prices remained steady with a 2.1% increase nationwide. Demand outpaced supply in most neighborhoods. Still, home sales were down about 3% from the year before.
So let’s look forward. Could 2015 be a great year?
Lawrence Yun, Chief Economist for the National Association of Realtors, predicts that 2015 will be positive due to many factors. The economy is growing. Interest rates remain low. Consumer confidence is improving. Gas prices are tumbling. The stock market is strong.
Still, low inventory will hold down sales. Many homeowners now have low interest rates and are not motivated to sell. New homes are not being built at the rate required to strongly impact inventory. Rents are rising at a seven-year high.
In 2015, watch for higher housing costs. I will be tracking the trends in our area. With no drop in home prices foreseen, now may be the right time to make your move. Let’s talk.
I’m often asked whether it’s better to rent or to buy. The National Association of Realtors (NAR) recently forecast that 2015 will be a “landlord’s market”. Rent growth continues to run higher than overall inflation. Landlords are raising their rents as the national vacancy rate dips to the lowest level in two decades. Rents are rising at the fastest pace in six years, according to the Bureau of Labor Statistics. Rental vacancy rates have fallen to 20-year lows.
If you have the down payment to purchase a home, there is a strong chance that you will be able to make lower monthly mortgage payments than rental payments. Buying for your first home or buying as a potential rental property often makes sense. I can help you work the numbers, or connect you with a trusted mortgage broker.