No one can predict the future, but economists like Dr. Lawrence Yun, chief economist for the National Association of Realtors, have a better chance at getting it right than real estate agents like myself.
So while I've been predicting that 2014 should continue the trend of increased home sales and slightly rising home prices, I was more than curious to see what Dr. Yun would have to say about the outlook for real estate in Albuquerque during 2014.
Dr. Yun was here in the Duke City this week to speak at the annual meeting of the Greater Albuquerque Association of Realtors.
I was excited to meet him, being a bit of a stats geek myself, so I took a moment before the beginning of the event to go up and say a brief hello. Dr. Yun was friendly and charming; it was a great pleasure to meet him.
What followed was about a one hour presentation of real estate information across the nation, along with specific stats and analysis for New Mexico and for Albuquerque.
Here were some of my key takeaways:
- Homes remain affordable in many markets across the country, but especially in Albuquerque where home prices have been slow to recover
- Many states in the nation are expected to see a plateau in home sales and pices in 2014, but here in New Mexico we should see a continuation of increased home sales and a slight increase in sales prices
- Banks have plenty of money to lend, but many are keeping larger than usual reserves, perhaps to protect themselves from lawsuits related to the foreclosure crisis
- If lending institutions were to return to more normal underwriting standards, we could expect to see a 15-20% increase in home buyers entering the marketplace
- While many cities have severe shortage of home inventory and home buyers are having difficulty finding homes to buy, Albuquerque's inventory is balanced, with about 6 months of available homes for sale
- Rising prices and interest rates, which Dr. Yun said could be as much as a point higher this time next year, will begin to make homes less affordable for buyers
- Demand for homes has been diminished the last two months, due in part to the rise in interest rates
The outlook for Albuquerque real estate in 2014 is positive, but of course no one ever knows for sure!
However, two things are certain: 1) there are plenty of nice homes to choose from, 2) interest rates, although they have gone up slightly, remain historically low.
Contact me at (505) 803-5012 if you are considering buying or selling in 2014, I'd love to help you and add you to my list of happy past clients.
For more information on the Albuquerque and Rio Rancho real estate markets, please read my real estate report for November 2013, Albuquerque Sales Down; Rio Rancho Sales Continue to Rebound.