US home prices estimated to rise in 2014
Posted on Tuesday, May 13, 2014 at 10:47:17 AM
Higher home prices can be both good news and bad for people interested in affordable residential financing. For some, it leads to greater equity and more flexibility. For others, it can limit the number of available properties on the market.
According to CoreLogic, home prices are expected to increase throughout 2014. This is based off of estimates of past upticks, including an 11.3 gain in the fourth quarter of 2013 compared to the same time in 2012. Home prices also remain 20 percent above the recent low experienced at the end of 2011.
"Limited construction of new homes and low inventories of existing homes for sale contributed to the jump in prices," said Dr. David Stiff, principal economist for CoreLogic Case-Shiller. "Developers remain cautious about building too many new houses until they see stronger demand in their markets."
In addition to these gains, the National Association of Realtors also reported that home price growth has slowed at the beginning of 2014. While year-over-year improvements remain, many metropolitan areas have been experiencing smaller increases this year.
However, this should be seen as a positive, according to Lawrence Yun, chief economist for NAR. A slower rate of growth will keep home affordability intact, although more construction is required to boost the current inventory.