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Housing Recovery Likely to Stay Steady in 2013

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Housing Recovery Likely to Stay Steady in 2013While some housing analysts — and consumers — may think a more robust real estate recovery is coming in 2013, one expert notes that the steady improvements should remain next year, and that no substantial gains will take place.

Speaking on behalf of the housing and mortgage forecast by Standard & Poor’s, the senior director of the company’s Ratings Services division, Valerie White, indicated that the moderate improvements seen in home prices and the economy, as well as continually low mortgage rates, are likely to continue moving into next year.

“We expect housing to remain a bright spot in 2013, as long as the U.S. avoids the fiscal cliff and growth continues,” White noted. “We forecast U.S. national home prices to increase 5 percent. However, tight lending remains a key concern for housing demand because the limited availability of credit could weigh on borrowers.”

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Check Your Credit For FreeThe home price growth projected by S&P is based on modest increases seen during nearly the entirety of 2012 on a national basis. Additionally, positive movement in the jobs sector — specifically, the U.S. unemployment rate — along with a solid gross domestic product should keep the real estate recovery moving along at a decent pace.

One X-factor that could throw a wrench in the agency’s outlook for the housing market in 2013 is the “fiscal cliff” discussions, which remain a hot topic among federal lawmakers in Congress.

A major official with government-sponsored enterprise Freddie Mac said he thinks the talks could have a great impact on the fate of the real estate segment, as well as future economic conditions.

“If for some reason they can’t work out a compromise to avoid the fiscal cliff, then that’s going to have a serious impact, not just on the housing-market recovery, but for the overall recovery in the macroeconomy,” said Freddie Mac vice president and chief economist Frank Nothaft.

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While analysts remain mixed on what to expect from housing in the coming year, it seems many consumers across the country are confident that home prices will continue their ascent.

According to a survey by Redfin, more than seven in 10 consumers polled said they believe home prices will hike in their communities in 2013. This marks a substantial rise from the amount who stated so in the previous survey, 61 percent.

Image: Edwart Visser, via Flickr

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