The real estate industry is expected to take an interesting turn in 2014 as the housing recovery continues and due to the appreciation of home prices. It is also believed that a revamped set of mortgage rules is to surface, making it possible for more people to own a house as more investors back off due to increasing house prices.
Industry experts’ projection and probability for the year 2014 are as follows:
Rise in Home Prices All Over United States
In the period between July 2012 and July 2013, home prices increased by no less than 12 percent on average. It is further expected to rise with the onset of the New Year, with predictions being indicative of at least an 8 percent rise. This very rise will affect the investors’ stance towards housing markets.
Residents to Have Greater Opportunities to Own a House
It is expected that investment firms and investors will pose a lesser competition to those who are purchasing a home for residential purposes. This is because investors in real estate usually plunge in when the market rates drop; and bail out when home prices start to rise.
House flipping, which is basically buying, renovating and reselling with a profit has declined quite steeply over the past year. More and more investors are pulling out and this is to continue well into 2014. So if you’re planning to buy a home, this is good news for you.
Mortgage Industry to be Defined by Qualified Mortgage (QM) Rule
A new set of mortgage rules are supposed to come into effect in 2014. If you’re curious about your eligibility for a home loan, take a look at the Qualified Mortgage Rule.
This new rule was finalized by the Consumer Financial Protection Bureau and has taken effect as of January 10th 2014. A huge chunk of all loan programs will be altered to catch up with the new QM rule.
Mortgage Rates to Rise
The Federal Reserve’s QE3 stimulus program will tend to push the mortgages rates to a new level in 2014, despite the steadiness in mortgage rates over the past few months. The Federal Reserve has managed to keep funds rate at almost zero for several months, causing the mortgage rates to record all-time lows in 2012. However, it is forecasted that mortgage rates will exceed 5 percent around mid-2014.