pmcdermott

The statistical measurement for U.S. homebuilder confidence dropped slightly in January.  The reading of 56 from the National Association of Home Builders/Wells Fargo builder sentiment index was down 1 point from December, but reading above 50 still indicates a view of “good” rather than “poor”.  Mortgage interest rates although still near historically low levels have risen more than a full percentage point and slightly lower numbers in new home sales have contributed to the decrease in builder confidence.  A lower supply of homes on the market, rising home prices, and still low mortgage interest rates have allowed home builders and experts to remain confident in a gradual recovery.

Full Article- Veiga, A. (2014, January 21). U.S. homebuilder confidence dips in January.  AP Real Estate Writer Fuze.

Retrieved from www.twincities.com

Twin Cities housing prices have hit a five year high and sales have risen to the highest level since 2005.  2013 started out strong for home sales, but has tapered a bit into the fall and winter. This tapering of sales activity has been attributed to a rise in mortgage interest rates and the government shutdown decreasing overall consumer confidence.  Even as sales activity has seen some tapering in 2013, home prices have not been decreasing.   A smaller supply of listed homes and a reduction of distressed or foreclosure properties have driven home prices upward.   Rising home prices should help increase the homes available for sale, as fewer homeowners will be underwater on their mortgages.

The Twin Cities has experienced increased sales throughout most of the metro area.  This growth has paralleled or exceeded that of most other metro areas nationwide.  Many experts predict that the real estate recovery will continue into 2014, but probably will not match 2013.  A stable real estate market that continues to recover at a healthy and sustainable rate should provide opportunities for buyers and sellers.

Full Article-Buchta, J. (2014, January 14). Housing prices hit 5 year high.  Minneapolis Star Tribune.

Retrieved from www.startribune.com

Twin Cities exurbs such as Otsego, Farmington, and Monticello have all seen significant increases in housing permits from 2012 to 2013.  These increases are still well short of the number of housing permits issued in the early 2000s, when many exurbs saw rapid growth.  Few expect a return to the high demand years that lasted until about 2008, but as home prices rise in the Twin Cities suburbs buyers are again heading to the outer edges of the Twin Cities.  Buyers are finding out that many of the bargain priced or bank owned lots in the suburbs were bought in the early stages of the housing recovery.  The exurbs have again become attractive for family’s willing to trade of a longer commute to the Twin Cities, for greater home affordability and larger lots.

Full Article-Feyder, S. (2014, January 13). Exurbs greet housing rebound with caution. Minneapolis StarTribune.

Retrieved from www.startribune.com

Economists make some predictions for 2014 in this article. Here are some of the highlights of the trends we might see in 2014.  More homes for sale in the coming year as home values increase and free up homeowners that may have been underwater.  Increased new home construction will boost inventory for home buyers and increase sales of new homes.  Interest rates will likely rise this year, but still be at historically low levels.  The housing market has been in a strong recovery this past year, but some recent data points to some softening in this market.   Even if the market softens or stabilizes from last year, 2014 still looks like a good year to be buying or selling a home in the Twin Cities real estate market.

Full Article-Collins, J. (2014, January 12). Real estate predictions: Home Listings, rates will rise.  Orange County Regster.

Retrieved from http://www.startribune.com/