2013 in the Books; 2014 is Go! PDF Print E-mail
Wednesday, 01 January 2014 00:00

Another year is in the books, and I have to give thanks once again to all of the fantastic individuals I had the honor to work with in 2013 in pursuit of their real estate goals.  As I've written before, nothing can replace the feeling of playing that unique role in helping someone to find the place they will be calling "home" in the future, and I am grateful to have the opportunity to play it.

Last year around this time I was wondering what 2013 would look like relative to the year prior, which had a solidly positive trajectory so far as the direction and the health of the area real estate market.  With 2013 now in our rearview mirror, without a doubt that trend accelerated, with rising prices, increased region-wide transaction volumes, and truly fierce multiple offer competition over desirable properties dominating the news and the experience.

As we head into 2014 though, things are a bit murkier perhaps than they were at this time last year.  Whether it was a seasonal coincidence or whether it was the trigger itself, the federal shutdown last October certainly marked a cooling off of the local market heading towards the end of the year.  There was an activity spike which occurred around Thanksgiving, but generally things calmed down a bit to close out the year.  In conjunction with this, we've seen interest rates trending higher with the commencement of the Federal Reserve's purchase taper, reducing the amount dedicated towards the monthly purchase of domestic debt.

Such purchases have been credited with providing support for bond demand, and as such for keeping interest rates lower than where they might otherwise be.  The purchase amounts are still significant, however, and given the Fed's bias towards staying accommodative on rates, we shouldn't see rates spike too too greatly.  We're coming off record lows, after all, so while 4.5% on a 30-yr might seem high relative to 3.5%, on a historical basis it is still extremely low.

For the last several years, the early months have seen inventory generally lag demand; we should have an idea pretty soon as to whether this will repeat for 2014, and where buyer sentiment/confidence sits in the process.  With area unemployment relatively low, and home affordability remaining reasonable in the region (as shocking as that sounds), it is likely to be another strong year for Washington real estate.  Personally, it wouldn't be bad for the long-term market if things were a little less frenetic than last year!

Last Updated on Thursday, 13 February 2014 13:22
 

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4500 Old Dominion Dr, Arlington VA 22207
Phone: (703) 524-2100 Fax: (703) 524-9014