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Housing Expert Miller: Home Prices Next Year Will Increase at Half the 2013 Rate

By    |   Friday, 27 December 2013 01:54 PM

Home prices have been rising 10 to 12 percent in recent months, but you can expect that pace to be cut in half next year, says Jonathan Miller, CEO of Miller Samuel, a real estate appraisal and consulting firm.

"How can we have price growth that we didn't see in decades? It doesn't make any sense," he told Yahoo.

An increase in housing supply will weigh on the market, Miller says. He says that current inventory is well below the historical six-month average, and credit is still tough to come by.

Editor’s Note: Obama Donor Banned This Message (Shocking)

About 40 percent of U.S. homeowners have low or negative equity in their homes, he says.

"They can't trade up, make a lateral move [or] downsize, so they sit."

Those who are capable of moving may be stymied by higher mortgage rates in the wake of the Federal Reserve's decision to start tapering its bond purchases, Miller says.

In addition, new rules written as part of the Dodd-Frank financial reform law will tighten mortgage terms starting next year. The new strictures "will continue to slow the momentum of improvement" in the housing market, Miller said.

New home sales fell 2.1 percent last month, but many analysts remain bullish on the sector.

"You did have a rise in mortgage rates, but house prices are still about 20 percent below the peak, affordability is high, and the labor market is improving,” Gennadiy Goldberg, an economist at TD Securities, told Bloomberg. “There’s a natural demand for more housing."

Editor’s Note: Obama Donor Banned This Message (Shocking)

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Home prices have been rising 10 to 12 percent in recent months, but you can expect that pace to be cut in half next year, says Jonathan Miller, CEO of Miller Samuel, a real estate appraisal and consulting firm.
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2013-54-27
Friday, 27 December 2013 01:54 PM
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