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Experts Predict Annual Home Value Appreciation to Exceed 6 Percent in 2013

More than 100 real estate and economic experts predict home values will end 2013 up 6.7 percent from the end of 2012, as the housing market recovery continues to widen and accelerate, according to the latest Zillow Home Price Expectations Survey. A majority of the panel also said that while rising mortgage rates don’t pose a threat if they stay within the 4 to 5 percent range, they could derail the recovery if they reach 6 percent or higher.

The survey of 106 economists, real estate experts and investment and market strategists was sponsored by leading real estate information marketplace Zillow, Inc. and is conducted quarterly by Pulsenomics LLC. Panelists said they expected median U.S. home values to rise to $167,490 by the end of this year, up from $156,900 at the end of 2012 and $161,100 currently. Based on current expectations for home value appreciation over the next five years, the panelists on average predicted that U.S. home values could approach new record highs by the end of 2017, coming very close to the previous peak level of $194,600 set in May 2007.

The expectations for a 6.7 percent year-over-year increase in home values was up significantly from expectations of a 5.4 percent bump predicted the last time the survey was conducted.

Panelists expect annual home value appreciation rates this year to end on a strong note, before slowing considerably from 2014 through 2017. Panelists said they expected appreciation rates to slow to roughly 4.4 percent in 2014, on average, unchanged from the previous survey. This rate is expected to slow further to 3.6 percent, 3 team collaboration app.5 percent and 3.4 percent in 2015, 2016 and 2017, respectively. Cumulatively, survey respondents predicted home values to rise 23.7 percent through 2017, on average, up from 22.3 percent in the last survey.

“Short-term expectations for home value appreciation through the end of this year are consistent with a nationwide housing market recovery that is both strengthening and widening, but still coping with high levels of negative equity, high demand and low inventory. Combined, these factors will continue putting upward pressure on home values for the next few months,” said Zillow Senior Economist Dr. Svenja Gudell. “But the days are numbered for these kinds of market dynamics, as investors begin to pull out of some markets, mortgage interest rates rise and more inventory becomes available. Over the next few years, these trends will help the market stabilize and will bring home value appreciation more in line with historic norms. As long as mortgage interest rates don’t rise too far and too fast, most markets should be able to absorb these changing dynamics while still remaining healthy.”

Panelists were also asked if recent increases in mortgage rates presented a significant threat to the ongoing housing market recovery. Among those expressing an opinion, 88 percent said no. Those panelists who responded “no” or “not sure” were then asked what minimum mortgage interest rate (on a 30-year, fixed-rate mortgage) would pose a significant threat to the housing recovery. Among these respondents, 61 percent said interest rates would have to rise to at least 6 percent to create a significant threat.


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3 Reasons to Buy that House NOW!

This is a straight forward advice I can impart. Seize the opportunities today to buy a home to trade up, to acquire something (rental income or owner use) for lifestyle changes (i.,e. empty nest, first home, kids in college. The values for home ownership are long term, consistent growth, stable asset class and personal and lifestyle enrichment.

One more word to the wise, allocate money and meet with a lender today if you need to get a loan and pre-approval and prepare yourself  for year-end bargains and buys. All indicators point to a robust sales period at the end of the fourth quarter. For Sellers, there are savvy buyers in the market place now and until the end of the year. Early 2014 will see a slowing of sales and shift in the financial markets… and hope there are no other world catastrophes to upset our global market balances.

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Palisades Riviera New Construction Rush!

So what’s happening in your neighborhood with new construction? Like it? Hate it? Hmmmm? Or don’t want to think about it?

There has been a rush of new construction going on in the Palisades Riviera… for that matter new construction is appearing in every neighborhood on almost every street. 

In 2011, Metropolitan Los Angeles ranked 5th of the major metropolitan areas for the most new construction permits issued (Houston was number one). In my Riviera Palisades neighborhood alone of the almost 600 homes, I have counted more than 15 new construction projects, all high-end homes being started or slated for the wrecking ball. When finished, these homes will range from $6,000,000 to $10,000,000+, a market value of more than $150,000,000.

The last time I saw anywhere near this fervor was around 2005-2006. The new construction rush, many of them spec homes, signals more confidence in real estate as well as about the  economy in general. Redevelopment brings improved home values.and improved community infrastructure, The price ceiling of higher end  homes is raised as well as the low priced entry level homes.

With new construction, however, neighbors must endure the congestion and the disruption to the once serene idyllic lives: Not to mention community (demographic) make-up and those generational and lifestyle changes.

The disruption in the short term are well worth the long term values.




What Me Worry? Act Now! 7 Reasons to Buy Now Worry Free

A recent post by real estate website Trulia, deals with the , “7 Serious Worries of Today’s Home Buyers.” This is another statistical survey poll that discourages many who should understand that what others fear is a time to make bold decisions. 2013 is a crossroads year in the residential housing market. values continue to build from 2012 and overall values have recovered in most areas upwards of 15%. I said “recovered” from the statistical bottom of the market in 2009.  The reasons to stay on the sidelines rather than to say “yes” and move tenaciously through the process of home buying are to miss opportunities of low interest rates and values again appreciating and on the rise. If you worry about today’s historically low Mortgage interest rates rising before you buy; or not qualifying for a mortgage at all; or appreciating home prices; or the “over heated” competitive marketplace, do your research, find a qualified, knowledgeable agent who has worked with the breath of qualified, marginal, savvy and first-time home buyers, and go forward and get into the market. The doors are open and opportunity knocks collaboration tools for business. The cycles of real estate move slowly and today we are in an upwardly trending market now in its third year, and values will soon surpass those highs in 2006 in most areas. Think home prices will fall after you buy? Think again. Get on board and enjoy the lifestyle and the security of home ownership..