This post is my opinion of what to anticipate in our housing market. Here in Santa Clarita Valley and San Fernando Valley.
January 2013 is just a few days away. Inventory is frighteningly low, pushing prices up. Mortgage rates are way lower than any 'historically low' I've seen in a 1/2 century, and expected to stay that way through 2014! The fiscal cliff is now being called the slippery slope and we are still wondering if the Mortgage Debt Relief act will be extended.
So, really, what do we do, where do we go, what's gonna happen? Thoughts and opinions.
I believe we will continue to see more traditional sellers come on the market. Hopefully slowly as the faster they come the slower we will see appreciation. Expect to continue to see an upward trend, here in California, in home prices. With rates staying low, the market will continue to have a bounty of buyers grabbing properties left and right. Multiple offers combined with minimal inventory pushes pricing up.
Building permits have been rising. The Newhall Ranch project along the 126 and 5 freeway corridors is closer to breaking the infamous ground. When new homes are built, homeowners sell the current as they want shiny and new. More homes purchased and sold will, of course, help our economy.
Foreclosures? In the judicial states there was a huge stall, those are starting to catch up, and more homeowners are getting foreclosed upon. In California, a non-judicial state, we had our stall with the Robo-Signing settlement. That's been moving along nicely. The number of REO's has significantly reduced. Short-Sales and Loan Mods have helped ease the distressed property inventory tremendously.
For many, however, the big question is that Debt Relief Act. Will it be extended? When will we know? And, if it doesn't....what's going to happen to all those homeowners trying to Short-Sale, Loan-Mod, or on the Foreclosure freeway?
Opinion: I do think it will get extended. It's been in the president's budget for quite some time. Attorney Generals for 41 states have been urging Congress to sign an extension. Too many homeowners are still in the midst of housing correction to have it not to get extended. I've spoken to, listened to, and read from enough bankers, Realtors, politicians, etc....it really would shock the heck out of me (and them) if it did not get extended for at least another couple of years. However, I doubt we will know for sure for several more months. And if ,God Forbid, it doesn't get extended...it will cripple many homeowners. Frighteningly so.Emotionally, financially....crippling.
The Fiscal Cliff, hmmm, I like that it is now called the Slippery Slope and I only comment on it regarding housing. And, the bottom line is this ~ Housing helps economy. No if's and's or butt's about it. With the housing market, I expect not to be 'normal' again for 5 more years. Of course, we never really seem to have been normal in the past 20 years but we do strive for normalcy in the housing market. Why? Because, housing stimulates the economy. More money moving around, more being bought, stimulates our economy.
Bottom line.....we've got a little ways to go. A lot say we are 1/2 way there. I do feel that we've got 3-5 more years of struggling sales, challenged homeowners, difficult buyer conditions.
Remember, these are just thoughts from a 10 year veteran Realtor that has been working with hundreds of homeowners over the years. We'll get through this, we always do. Some pain along the way, many challenges too, but we will overcome.
We have no other choice but to move forward.