Predictions for next year's housing market
December, 2012
The housing market is beginning to pick up its pace from the previous few years in which the recession hobbled the economy. With the last couple months resulting in improvements for the housing market, real estate experts at RealtyPin recently released predictions for what the organization believes will happen with the housing market in 2013.
One of the predictions made by RealtyPin is that Americans will benefit from years of underbuilding. The country has experienced years of a surplus of vacant houses, which was worsened during the recession. Once the recession began, 3 percent of the nation's existing homes were vacant, which was an all-time high for a figure that is normally about 1.5 percent.
As of mid-November, the vacancy rate had decreased to 2.1 percent. Since the vacancy rate has been so high, many homebuilders haven't had the opportunity to build any new homes, which will result in existing homeowners having an easier time selling their houses in 2013 since they won't have anything new to compete with.
Another prediction made by RealtyPin is that rent prices will hit a plateau. While rent is at all-time highs in some areas of the country, mortgages have decreased, making owning a home a more attractive option for some Americans.
Landlords have taken advantage of tenants recently by charging high prices for rent because they're aware that many Americans are hesitant to jump into the housing market and purchase the home of their choice, but many renters might soon have no choice since mortgages have decreased to be cheaper than rent in some areas of the country.
RealtyPin also suggested that quantitative easing will backfire. The aim of the Federal Reserve's Quantitative Easing plan is to make sure interest rates are kept low, which has been a working plan over the past couple years.
Federal Chairman Ben Bernanke has expressed that he wants to keep interest rates low until 2015, which could cause some first-time home buyers to delay purchasing a house, but low prices should be taken advantage of immediately since home prices will continue to increase during the recovery from the recession.
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