Real estate market never remains the same for long. The market trends keep changing as per the alterations in global economy. Now, the same trend applies for the Florida real estate market as well. As the experienced economists stated at the Florida Realtors' 2014 Real Estate and Economic Summit in December, the upcoming changes in global economy can make the housing sector in Florida grow slowly in 2014.
How strong Florida real estate market is going?
There was a hint of substantial growth in Florida’s housing market in 2013 as well. By the third quarter of 2013, the number of closed sales and properties in inventory increased considerably. Apart from that, the median prices were high enough. Home affordability was also high. Dean Asher, the 2013 Florida Realtors President stated, “Data from the third quarter of 2013 shows that Florida’s housing market continues to grow and gain strength”.
2013 Was a really positive year for the realtors in Florida and market experts believe that this positivity will continue in 2014 as well.
What are the prospects in 2014?
The experienced economist of Florida Realtors, John Tuccillo believes, "The real estate market is going to grow, and we'll probably see about a 10 percent increase in residential sales". The value of home will increase considerably. There are chances for the price to go up gradually by almost 5%. In the last 18 months, the property prices have increased almost about 12%. This is an incredible increase.
There is a slight increase in the number of vacant properties as well. Federal Reserve has planned to modify its bond-buying program in the upcoming months. After the modification, the property prices are supposed to increase considerably.
Dr. Frank Nothaft, the chief Freddie Mac economist said at a recent conference, "Mortgage rates have gone from dirt cheap to cheap and now I expect them to rise to low - maybe 5 to 5.5 percent toward the end of next year - still very low to where they've been historically". So, there is hardly any doubt that mortgage rates will maintain a moderated increase in Florida in the coming months of 2014.
So, how the housing market may change in Florida?
As Nothaft pointed, there are also a few challenges to face in 2014. For instance, there is the restricted access to credit. Apart from that, most of the market experts are predicting that home buyers may face problems to deal in a market where rates are going up. The increased value of properties and continuous increase in mortgage rates may force the homeownership rate to drop significantly. However, with improvement in job market, home buying may be a bit easier. But the question is how steady will be the growth in job market. Sean Snaith, the professor of University of Central Florida recently said that uncertain growth in employment will only make people avoid home buying. Nothaft also feels that unemployment matter and he said, "People who want full-time jobs but can't find them and have to work part time add to the underemployment rate of 13.5 percent. That's a large share of the market that doesn't have the resources to buy."
So, it’s quite evident that home buyers in Florida need to stay updated about the changes in real estate market. As inventory is huge, the competition will be less enough. Mortgages will be easier to get but people may have to pay extra for the interest rates. That’s why, prospective buyers who’ve enough resources or a steady job must make the move now and opt for the mortgage before the rates go up even more.
By Rikk Miller
