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Monday, January 6, 2014

What Did You See in 2013?

What Did You See in 2013?

Around this time of year I am usually asked, “John what do you think will happen in the 2014 Real Estate market of Metro DC area? Remember, this includes Washington D.C., Maryland and Northern Virginia. Before I answer that, let's first recap 2013. As you probably have read and heard, 2013 was an exciting year in real estate. We had a healthy increase in home appreciation in the first couple of quarters and since then, it has tapered off. The increase occurred mostly because of low interest rates and low inventory due to banks holding off from flooding the market with foreclosures.

The low inventory and low interest rates fueled the market and we saw many multiple offer scenarios with less than a three month supply of homes in most market areas in the Washington DC Metro Area. The multiple offers created competition and subsequently, prices rose by an average of 10 - 13% depending on the area. In the 4th quarter, interest rates increased by about 1% and the government shut down tapered down the market. However, because of these factors the inventory has risen slightly to a more stable level.

2014 will be just as exciting. We will see more stabilization in the market, interest rates will rise 1% and we’re expecting approximately 5% appreciation in home values. If you’re looking to buy or sell, it’s time to engage the market place.  If you’re a potential buyer, this is a great time to enter the market because homes are still affordable and interest rates are still reasonable. Also if you purchase now, you probably won’t be in competition with other buyers.

As for sellers, there are motivated buyers in the market looking for homes just like yours and buyers in the market place today have either lost out on other buying opportunities, have to buy now or do not want to settle for a less expensive house when interest rates increase. Thus, the buyers in the marketplace today are serious buyers and not just tires kickers.

If you or anyone else has any real estate needs, please feel free to reach out to me by phone or email. Thanks and I look forward to our conversation!