If the housing market was in overdrive for much of 2013, during the first half of 2014 it hit the metaphorical brakes. Winter storms across the nation contributed to sluggish sales during the first quarter, while rising mortgage rates and tight inventory didn’t help. By spring housing began to thaw, with April Existing-Home (previously-owned) sales numbers ticking up for the first time as the pace of price gains slowed. By June, sales had reaching their highest levels since last October.
Although the headlines each month can create high drama as the numbers go up and down, the theme so far this year is this: we’re steadily on the road back to normal. Here’s what real estate experts say to expect for the second half of 2014.
Prices will go up, but not as fast as in 2013
In 2013, the housing market clocked double-digit, year-over-year price gains each month. Now that pace is slowing. Prices across the 20 metro areas tracked by the S&P Case-Shiller Indices rose by 10.8% year-over-year in April, a significantly slower rate than the prior month, when prices rose 12.6% for the 10-City Composite and 12.4% for the 20-City Composite. Other indices are also reporting slows: Mountain View, Calif.-based data firm Altos Research finds that through June 30th, prices are up just 9% year-over-year.