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What to Expect for the Capital Region Housing Market in 2014

Albany Real Estate November Pending Home SalesHappy New Year! If you’re reading this you’ve successfully made it through 2013, or at least made it through. I know I’m grateful for my healthy, family, and the improving economy. But what can we expect in 2014 for the Albany real estate market.

As of the latest monthly real estate numbers, pending sales in November were up 9.0% to 651 pending sales contracts. Meanwhile inventory has shrunk 6.6% to 7,514 active listings (just over 9.5 months supply of inventory). This is the lowest inventory count since 2007. Seller’s are receiving on average 93% of list price (0.8% up from last year). This is the highest sale price to list price ratio since November 2009.

The median sales price drop slightly to $190,000 (a 2.6% decline from November 2012). However, despite this price dip the November 2013 median sales price still remains higher the November 2005 and 2006 numbers.

If you saw the article in the Sunday Times Union, you know my opinion on where 2014 is going:

Alexander Monticello, a licensed real estate broker in Albany, said he was involved in at least 15 transactions over the course of 2013 where there were multiple offers.

“It is a more competitive market, but there are still overpriced homes on the market that will require the seller to give up something,” Monticello said. “Buyers are savvy, because they have the opportunity to do a lot of online research.”

Monticello did not expect the rising interest rates — hovering around the 4.6 percent mark these days for a 30-year-mortgage — to cause a market slowdown. It might encourage buyers to get serious, because the rates are likely to keep climbing. While nearly a full point higher than they were a year ago, interest rates are still near historic lows, Monticello noted.

As we move into 2014 we await the final numbers from December 2013, due out at the end of January. I expect we’ll see a modest December price dip due to the rising interest rates but overall year-over-year price gains for the Albany housing market. This year will bring continued rising home prices, rising interest rates to around 5.5% (for a 30 year fixed), and a more balanced buyers-sellers market. At the same time sellers will respond to the growing demand and increased prices offering fresh inventory onto the market.

Below is the latest GCAR Skinny breaking down the monthly housing numbers.

If you’re thinking of selling, you can get tips from my free seller’s guide. If you’re looking to buy make sure you review the buying steps in my buyer’s guide. And as always, if you have questions or concerns don’t hesitate to contact me.