With the New Year underway, and a year of substantial improvement in real estate activity, the obvious question is, What is the real estate forecast for 2014? The crucial elements are prices and interest rates.¬† So where do they seem to be headed?
The economic news for our region is better than at any time in the last five to six years.¬† By almost every indicator, Connecticut (and the Northeast in general)¬† has trailed the economic recovery, posting modest to no gains in prices until now.¬† The Federal Reserve Bank of Philadelphia has posted their “Coincident indexes” report which is constructed from state employment data, and in the report tracking the last 3 months, we can see light at the end of the tunnel.
This summary of current economic conditions takes into account 1) non-farm payroll employment, 2) average hours worked in manufacturing, 3) the unemployment rate, and 4) wage and salary disbursements deflated by the consumer price index. Fancy economic talk! And it brings us to a conclusion that Connecticut is doing okay!¬† People are working, and earning at respectable numbers.
Of course, this is just what we’ve been waiting for.¬† In real estate, people can’t buy homes if they are not employed! The expectation is that there will be less uncertainty on the part of would-be buyers in 2014 resulting in more opportunity for buyers to buy and sellers to sell. And prices, while modestly up in our area, are still very attractive.
Even with the modest gains in the last 12 to 18 months, home prices in most of Fairfield County are still between 15-20% off their peak.¬† Where will the go in 2014?¬† As for the real estate forecast for 2014, the Realtors Confidence Index Survey projects .1% to 3% increase in Connecticut in the next 12 months.¬† Another indicator that it’s a great time to buy, and a fine time to sell.¬† It’s still a wonderful market for the “move-up” buyer.
In our next blog we’ll discuss the impact of interest rates. The HomeVision Group is here to answer any of your real estate questions. Contact us whenever you’re curious about real estate in Fairfield County, Connecticut.