Freddie Mac Takes The Temperature Of The Market

thermometerRecently, Freddie Mac released its US Economic and Housing Market Outlook for January showing that four of the key housing indicators are all moving in the right direction, which bodes well for an ongoing recovery.

“As we start 2014, the housing recovery continues its steady pace,” says Frank Nothaft, Freddie Mac vice president and chief economist. “House price gains will likely moderate from last year’s pace but rise about 5% in national indexes.  Home sales, as well as other key indicators, continue to trend in the right direction, although in some markets we are seeing the sales recovery strengthen while many others remain weak.”  The Naples Florida market is not one of the markets where the recovery remains weak!  Our prices are rising and inventory is decreasing.

What Are The Projections For The First Quarter

  • December’s unemployment rate of 6.7 percent remains stubbornly high.  It may take another two years until labor market gets back to full employment.
  • Mortgage delinquency rates at 5.88% have been nearly cut in half from their peak, but they are still very high from their long term normal average of approximately 2%.
  • From 1999-2006, mortgage payments on a hypothetical 30 year fixed rate mortgage would have increased by 50% more than income growth.  Currently, payment-to-income ratios are only 60% of the level we had in 1999 suggesting room for continued house price growth.
  • When measured against the single family housing stock, historically home sales have averaged about 6% of the stock at time is nowan annual rate.  During the housing boom, home sales increased up to about 9% and then plummeted down to around 4%.  With home sales at 5.8 million pace in 2014 this rate should rise up to 5.7% for 2014.

Visit the Freddie Mac website for more information on their predictions for 2014.

The Time Is Now!

Every blog this week has talked about the fact that the time is now to purchase your first home or move up to your dream home.  Start your search here for your new home or call me at 239-601-3174 and I will search for you.  Together we can find your dream home!

Remember it is always toasty in Naples and you deserve your piece of Naples sunshine and your dream home!

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