Housing Market to Improve in 2014 as Mortgage Availability Concerns Ease

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More people plan to buy a home, recent economic outlook shows. The good news, according to an article published recently on Inman News, is that nationwide 6.9 % more people were looking into buying in December, up from 5% in November. The not-so-good news is that existing-home sales have not seen much of a rebound lately, with pending home sales only stabilizing in November.

Yes, there still are concerns about mortgage availability, but people have improved their perception and attitude about the ease of getting a mortgage. This comes as a natural reaction to the fact that loan officers have eased lending standards for residential mortgages, compensating the negative impact of the current higher interest rates.

To continue the series of good news, economists predict that the housing market's contribution to the economic growth this year will double. According to the article on Inman News, the GDP growth will reach 2.9% in 2014, but we have to wait and see.  Economists made some other projections in the past that were not confirmed in reality. Fannie Mae expects that 0.6% of the GDP growth to come from the housing market. The signals we get from home builders are extremely positive so we hope it will be even more.

Now that the foreclosures and distressed properties are fading out, competing less with the other residential properties on the market, we may experience a double-digit growth for the new-home sales and housing starts. According to the article, first-time home buyers and trade-up buyers need to step up and make for the decline in transactions made by investors if we want to see improvements in purchase mortgage applications.

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