What Is the Housing Market Forecast for 2015?
Will home prices rise or fall in the coming year? Before we peer into the future, let’s first take a look at the recent past. Following the financial crisis that began in 2008, home prices hit rock bottom in January of 2011. But they have been rising ever since and are now in their fourth consecutive year of recovery. In fact, home prices have increased a total of 39% since bottoming out in early 2011. As of July 2014, prices were up 9% since the same time last year, and there were 10% more homes on the market.
Rising prices and a greater number of homes for sale mean more and more people are eager to buy and sell. So what does the future look like? More growth in both home prices and homes on the market. In 2015, home prices are forecasted to increase 7% and 10% more homes than last year are expected to be for sale, according to Altos Research, a company that tracks every home for sale and every home sold in the country (that’s close to 100 million homes!).
While the rate of increase in home prices is declining somewhat (7% in 2015 vs. 9% in 2014), there’s no denying that the housing market is still robust. It’s important to note that this growth isn’t just occurring in “hot” markets, such as Miami or Las Vegas. Home prices are increasing all across the country—and for homes in every price range.
As of July 2014, about 1.4 million residential homes were for sale in the U.S., a slight increase over 2013. And they’re selling faster than they have in the last few years (2010 saw the peak in the time necessary to sell a home). Faster sales are yet another sign that the housing market is healthy today. Around 35% of these homes are overpriced when they’re first listed, requiring price reductions before they can be sold.
In short, the housing market is expected to grow for a fifth consecutive year since the financial crisis. An improving economy should help support this growth. If you’re thinking about buying a home in 2015, expect to see slightly higher prices than in 2014—and more homes for sale. At CMG Financial, we’ll be here to help you make the best decisions, including choosing the right mortgage for you.