Category: Market Updates
revealed that two additional analysts had also upgraded their forecasts.
Zelman & Associates
“Ivy Zelman, chief executive of research firm Zelman & Associates, said Wednesday she was now expecting prices to rise by 7% this year, up from earlier estimates of 6%, 5%, and 3%…She’s also calling for a 5% gain next year because she says the supply shortages and growing demand that fueled last year’s turnaround show no signs of easing.“Her reasons:
“The shortage of housing capacity continues to resonate. Just as deflation was a national headwind that stretched deeper into the economy than anyone would have imagined, we believe that appreciation can carry broad, positive implications for the consumer and economy beyond many expectations.”
John Burns Real Estate Consultants
“John Burns, who runs a real-estate consulting firm in Irvine, Calif., is calling for a 9% gain in home prices this year, up from a 5% forecast late last year.”His reasons:
“Strong investor demand and low interest rates that have boosted the purchasing power of buyers.”These two experts join a long list of housing analysts who have now called for a major rebound in housing prices in 2013.
Trulia Rent Monitor where they revealed that rental prices have increased dramatically in the last year.
“Nationally, rent gains continued to outpace home price increases in October, rising by 5.1 percent.”Based on the concept of supply and demand, we believe rental prices will continue to substantially increase over the next few years. The long-run 30-year average increase in multifamily rental households is 200,000 each year. Over the next few years, those numbers will more than double to over 500,000 each year. Freddie Mac in their latest report, Multifamily Research Perspectives, projects housing demand going forward.
“Given assumptions consistent with economic growth slightly slower than long run averages, multifamily demand is likely to be in the range of 1.7 million net new renter households between now and 2015.”The cost of owning a home will begin to increase as both prices and mortgage rates are expected to inch up in 2013. Perhaps now is the perfect time to lock in your long term housing expense by purchasing your own home. -KCM