by
On Jun 25, 2014
Listed in Local Real Estate Market, Park Place Homes

2014 Real Estate Trends- Check Up

In January, Realtor.com posted an article outlining some predictions for the real estate market in 2014.  We are nearly half way through the year and we wanted to take a moment to look into these potential trends and see how the local real estate market in Midland Michigan is stacking up.

Prediction 1: Inventory should stabilize and return to traditional seasonal levels.

The Midland Real Estate Market tends to mirror the national trends at a slightly delayed pace. Realtor.com stated that 2013 was a year characterized by low inventory and predicted that nationally the inventory of available homes for sale should increase in 2014.  A quick analysis of our MLS data shows that our inventory is actually down about 12% for the 1st half of 2014- and nationally a housing shortage has been reported.  If Midland’s real estate market follows the prediction, we may still see the increase in inventory that was predicted.  This would be good news for buyers as they would have more choices, but bad news for sellers as increased inventory could mean lower sales prices in the future. However, if Midland follows national trends, we will potentially see a housing shortage as well.  This would be good news for sellers!

Residential Single Family Homes, Midland Board, 1/1 to 6/23

Listings

Sales

Inventory

2013

1299

581

718

2014

1225

547

687

Unit Chg

74▼

34▼

31▼

Percentage Chg

5%▼

5%▼

4%▼

 

Prediction 2: More homeowners are likely to return to positive equity.

Realtor.com predicted that rising prices will help homeowners regain positive equity.  According to our MLS data the average list price for a single family home in the Midland board in the 1st half of 2013 was $155,985.  In 2014, that number rose 9.8% to $171,325.  However, in the same time period, average sales prices rose only 1.1% from $145,220 to $146,881.  Although home prices in Midland haven’t suffered the massive value swings seen in bigger markets, many homeowners have felt the pinch of the declining market in the last few years.  Slow and steadily rising home values may be a positive sign of market recovery.

 

Prediction 3: Mortgage rates are expected to rise.

Mortgage rates for a 30 year fixed loan for January-May 2013 ranged from 3.5% to 3.75% according to the website www.barchart.com.  During the same time period in 2014, rates ranged from 4.1% to 4.4%.

Capture

Rising rates can have an interesting effect on home sales.  Logically it seems home sales would start to decline.  In reality, the threat of rising rates often pushes potential buyers into action.

 

Prediction 4: Foreclosure activity is expected to slow.

In 2013 from January to May foreclosure sales made up about 4.8% of the home sales in Midland County. In 2014 that number slipped to 4.3%. In the same time period foreclosure listings were up slightly from 31 in 2013 to 35 this year. While foreclosure activity has remained rather steady in our area, nationally foreclosure activity has been on the decline. As our area tends to follow national trends at a delayed pace, it’s likely that the number of foreclosure listings and sales will decrease in our area as well.

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