Housing market expected to continue improving in 2014
Homeowners may be perusing more floor plans in 2014, as the housing market in the new year looks to be a slowing but steady continuation of last year's recovery, according to USA Today. Home construction may be a key component in that process.
A slow improvement
According to MSN Real Estate, home prices are expected to rise in 2014 as the market continues its recovery. Clear Capital, which provides real estate data, found that 225 of 276 U.S. cities saw an increase in home prices. Nationwide, that came to about a 10.9 percent bump in housing costs, at a median increase of about $30,000, MSN reported.
While an increase in price may seem like a bad thing, it means homeowners with previously worthless mortgages may no longer be underwater, and can start selling old homes and buying or building new ones. In 2013, the housing recovery also pushed buyers into taking advantage of low prices and mortgage rates, resulting in limited housing selection and bidding wars. The upcoming year's slowed but steady growth could signal more stability and a less frantic market.
"You want boring in the housing market," Svenja Gudell, Zillow director of economic research, told USA Today.
What to expect
In addition to price increases, homeowners can also expect higher mortgage rates and more home sales, albeit at a slower pace, according to USA Today. That means that as the market moves more toward sellers' advantage, there is a shrinking window to take advantage of the current prices. Homeowners who do not want to buy may consider housing construction, another part of the industry that's expected to continue recovering. Goldman Sachs Asset Management told USA Today that, while construction won't return to normal levels, it will still be strong enough to be a main component to the housing recovery.
"The construction revival is primarily a matter of when, not if," Tom Teles, GSAM head of securitized and government investments, told the news source.
Tips for buyers
More homes being built means more jobs for construction workers and manufacturers. It also means a more stable time to build a home. Homeowners who are unsure where to start looking into construction may also want to consider the benefits of a newly constructed home compared to buying. According to U.S. News & World Report, newly constructed homes often require fewer repairs than existing homes, as well as less maintenance. Customization also means homeowners know what they are getting. Finally, mortgage-financing perks could be accessible through builders, according to the news source.
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