The pace has picked up in the real estate market with 2014 looking to be the year of the repeat homebuyer, according to Jed Kolko, Trulia’s chief economist. Real estate market improvement means, that when it comes time to buying a home, repeat home buyers represent a significant, and growing, segment.
Trulia predicts repeat home buyers, will define the market in 2014 in contrast to 2013, when investors were the major buyers. Other new real estate year predictions include:
• Less frenzied home buying
• Lower affordability
• Shift away from single-family home rentals
• Shift toward urban apartment rentals
New Southern California home buyers face major hurdles in the market while repeat buyers have an easier path, especially those with value in their old homes. They don’t need to worry about the major obstacle facing many people who don’t own their homes, namely having the down payment for a new home. Repeat buyers are more likely to be employed at levels necessary to finance homes and have the equity to buy a new home.
Rising Southern California home prices mean investors make less money. That’s the major reason they’re predicted to exit the market with repeat homebuyers picking up the slack. Home values have risen in today’s market. Repeat buyers can make necessary down payments more easily. Mortgages should be easer to get due to more inventory on the market and lessening refinancing activity.
Southern California mortgage interest rates are predicted to go beyond 5 percent in 2014. Lending requirements will be tighter. Housing prices will rise even if housing sales volume drops. All-cash buyers will account for nearly half of the market, which analysts say is being fairly priced in 2014. Rising prices should encourage more people to put their homes on the market and look to buy another home, Trulia says.
With the recession market seemingly coming to an end, Kolko and Trulia predict fewer single-family home rentals as families can afford to buy homes. These families will propel current home owners onto repeat buying mode as they upgrade due to higher re-sale prices and more readily available financing options.
Elizabeth Marquart is Southern California’s real estate expert and home improvement project manager of choice. She always provides reliable and diligent real estate representation-all with the highest degree of integrity. Visit www.ElizabethSells.com or contact her for any real estate and home improvement questions by calling (310)246-0888 or at AskElizabeth@ElizabethMarquart.com.