Market Watch for 2014

We are not at all surprised by the National Association of Realtors home sales statistics for 2013: over 5 million existing homes were sold in 2013, the most since the real estate frenzy of 2006 when home sales reached 6.5 million. In fact, our own regional sales data paints a similar picture.Keller Williams’ closed units increased by nearly 50% over the rest of the Florida Association of Realtors from Nov. 2012 to Nov. 2013, based on MLS numbers.

The National Association of Realtors Chief Economist Lawrence Yun attributes the national housing surge to job growth, low interest rates and pent-up demand. Those factors have also played out in the Tampa bay region as well.

So how does the real estate market look for 2014? There are three factors that may reshape expectations for housing sales this year: low inventory, lending policy changes and flood insurance reform.

The Dodd-Frank Wall Street Reform and Consumer Protection Act went into effect in January. The idea behind this was to minimize borrowing risk by limiting debt ratios to 43 percent and loan fees to 3 percent. We still expect sales to be strong for the majority of this year, despite higher interest rates and home prices.The “unknown” aspect of flood insurance policy weighs heavily on those properties with water locations. Yet, we remain positive about the market recovery. Those who have steady employment, down payments and acceptable credit should continue to be well-positioned to take advantage of the market’s opportunities.