I’M BACK WITH 2014 PREDICTION!!!
So as one can obviously see I have been a giant slacker on the blog!!! I apologize for that and will pick it up again now that we are in the new year (not a new years resolution, just a commitment to do a better job for my readership).
This year is shaping up to be a very interesting one at least as far as real estate is concerned. Rates have continued to creep up since May of 2013 and most analysts do not expect that to change any time soon. With the rising rates has come a slow down in the market, both the number of properties being closed and the price appreciation have slowed. I am not entirely sure where we are headed this year but I am pretty certain that the Colorado Springs market will remain fairly steady. We just seem to keep moving along, good, bad or ugly we are a very steady market.
Other big changes… Investor buyers have slowed down and will likely continue to slow as prices continue to rise. Now that most of the “good deals” are gone so are the institutional investors and those looking for a “steal”. Fix and flips should get better as time passes but I do not expect it will be like the old days. The biggest reason for this is the heavy growth of short sales during the recession.
Foreclosures have fallen to the lowest level since 2007 and I do not expect this to change drastically any time soon. Underwater sellers, real estate professionals, and banks all figured out that short sales were a better way to go than foreclosures. This shift has drastically affected the number of homes that go all the way through the foreclosure process. I expect that this will not change until the economy fully recovers and banks close or shrink down the massive short sale departments. This could easily be YEARS from now. There is a high likelihood that the Great Recession actually created a fundamental change and short sales will be a permanent part of the real estate landscape. This in turn will permanently keep the number of foreclosure properties lower then pre-Great Recession levels! For the majority of people this will really have little affect, those that are in the fix and flip business will continue to feel the pinch but that is a very small portion of the market.
Lastly, buy and hold/long term rental properties continue to look like a good investment. Rents remain high and buy vs rent has lost a bit of momentum mainly because it is still somewhat difficult for many buyers to get a mortgage as rates and price continue to rise making homes less affordable (the government intervention in the lending markets has continued to hinder the recovery and they continue to make it more difficult to get a loan). While this is bad news for buyers it can be a bright spot for those looking to be landlords!