It is a wonderful time of year when all the pundits are coming out with predictions for the 2015 real estate market. As one of the brighter spots in the economy in 2014, there has been a cautious optimism gaining traction on the outlook for 2015.
The decrease in gas prices has a direct impact on our area sales and home values. As prices go down, metro area jobs are more accessible to the workforce, and local pricing becomes more attractive for those who can afford to commute. Lack of affordable housing inventory is driving prices up with multiple offers on many houses priced below $200,000.
On the negative side of this equation, loss of oil field jobs is something to watch for impacting the millennials who have flocked to higher paying jobs in the Dakotas and are drifting back home as pink slips begin. As our national economy reacts to the loss of oil revenues in states such as Texas, the Dakotas, Wyoming and Louisiana, we can expect ripple effects on related industries which are hard to quantify but will be a factor in the coming year.
Rising home prices could very will be impacted by a new policy beginning this month by Fannie Mae, a sharing of their immense data base with lenders. Lenders will comparing the Fannie Mae data to score appraisals for any potential discrepancies.
I share the fear of appraisers who question the effectiveness of a desktop underwritten appraisal compared to a feet on the ground, local appraisers opinion, on site inspection and knowledge of the local market.
I would expect closings to take longer as appraisals may be reviewed for longer periods..and subsequent increase in appraisal fees to follow.
On the upside rates are incredibly low, first time homebuyer money is available for down payments, and even Fannie and Freddie backed loans have reduced their downpayment requirements to 3% lower than even fha. Usda loans in the rural areas are used extensively. With 0 percent downpayments, these help many families enter the American Dream through the front door. Good for buyers, great for sellers!
My prediction? No crystal ball here. it is my job to try and read the tea leaves before they dry out, keep on top of current winds, and do the best to help my clients in a rapidly changing environment. Todays market will not be Aprils market. Seasonal fluctuations , monetary policy, weather..it can all change in a day. People will always need houses, homeowners will want to sell houses..and that, in a nutshell, is my outlook for 2015!