New buyers: with 5.2 million foreclosed homes in 2007 & 2008, these owners will be passing the seven year mark in which their foreclosure drops off their credit report. Starting now, they will be able to qualify for a non-FHA mortgage. Plus with their credit improved and tired of renting, we look for these buyers to be back in the market.
New sellers: current average time staying in a home is over 13 years (longest ever). Sellers that have been waiting for prices to rebound will be putting their homes up for sale. Those baby boomers and empty nesters that are anxious to downside. Plus the first time home buyers from a few years ago that need a larger home will be selling to move up.
Interest rates: we are always talking about how low they are. This year will be the bottom and you better hurry to lock in. Federal Reserve policy of lower rates were based on employment, inflation and GDP. Historically, the Fed has been slow to react and it looks like they are doing it again.
Renters: 35% of households rent. This has slowly increased each year since 2005, with a low of 30%. Today, with millions of properties owned by investors for rental purposes, the renter with large families are opting to rent 3 or 4 bedroom homes versus renting the two bedroom apartment. Get ready in 3-4 years when the investors decide to sell/cash in and these renters turn into buyers.
New developments for 2015: Look for mortgage qualifying to get easier. Look for builders to keep increasing the home price. Look for developers to over build new apartment buildings. Look for investors to start selling.