Recent forecasts predict better times ahead in 2012
Although small, a slight uptick in the housing market next year is predicted. A survey by MacroMarkets of more than 100 economists and industry experts shows they expect home values to go up — just a little. About .25 percent in 2012 and a total of 1.1 percent through 2015.
Slowing the recovery down are the many foreclosures clogging the market. A recent article in Money Magazine notes that Freddie Mac predicts that in 2012, 4.8 million homes will be sold in total, while there are more than 5 million homes for sale. The market considers six months of housing inventory to be healthy — more than a year’s worth of inventory is a sign that the going will be tough to return to healthy market conditions.
For buyers and sellers in 2012, the recommendations are to “think small” and “price smart.” For buyers, looking at smaller properties mean smaller loans, smaller payments and smaller home costs overall (energy, water, etc.). For sellers, working with — and listening to — an experienced Realtor when it comes to setting the sale price of their home is critical. According to Trulia, about 25 percent of homes it tracks has reduced its price at least once, by an average of about eight percent.
And of course, for homeowners not looking to sell, now is the time to look at refinancing, as mortgage rates continue to hover at all-time lows. Considering that just recently 15-year mortgage rates were more than half a point less than 30-year mortgage rates, a homeowner who could afford the higher payment could refinance a $250,000 mortgage with a 15-year loan and save more than $100,000 over the life of the loan compared to a 30-year mortgage.
Dan Lesher Realtor, Principal Broker, CRS, ABR, ePro, PSC, Member NRBA
Realty World Select
Licensed in the Commonwealth of Virginia