Industry experts and market analysts expect housing to continue to build on last year’s gains in 2014. Home prices – which rose 11 percent last year – will continue to rise, though at a slower rate. And those price increases will lead to fewer underwater homeowners and, as more homes are put up for sale, improved inventory levels. In addition to rising home values, analysts expect higher mortgage rates in the new year, though they believe it’ll have little effect on buyer demand, which is expected to remain at a healthy level. Celia Chen, an economist at Moody’s Analytics, predicts job growth will spur a surge in new residential construction this year. Chen believes the economy will add about 200,000 jobs a month, leading to greater housing demand and increased homebuilding activity. The spike in new residential construction will lead to even more jobs and support a stronger, growing economy in 2014, according to Chen. More here.
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Job Growth To Drive Housing Market In 2014
Economists Forecast Gains For Housing In 2014
A gathering of economists recently brought together by the National Association of Home Builders forecast continued gains for the housing market, despite obstacles that are impeding its recovery. David Crowe, NAHB’s chief economist, said the cards are in play for a decent and fairly strong recovery in 2014 and particularly in 2015. According to Crowe, housing has been growing at two, three, and four times the rate of the rest of the economy in recent quarters. That growth, spurred by a double-digit increase in home prices as well as rising household formations, has led to an increasingly healthy market and optimistic forecasts from experts and analysts. Still, labor shortages, tighter inventory and credit, higher material prices, and inaccurate appraisals are hurting new and existing home sales. And economic uncertainty tied to the government shutdown and debt ceiling debate also threaten housing’s progress. Mark Zandi, chief economist at Moody’s Analytics, feels Congress will resolve these issues quickly but cautions that, if they don’t, it challenges the economic outlook and could result in another recession. More here.
