Since the housing crash of 2008 the market has fluctuated in a downward pattern that left many wondering how long it would take to turn things around. Every year predictions and trends that seem to be gaining traction are contradicted by mixed signals. In a survey conducted by home buyer website Trulia shows that this instability has not taken away the Americans faith in the real estate market. Among the 2,000 respondents of the study 61% believe that the price of real estate will rise next year, 58% believe that in ten years we should be back to pre-crash peak price levels, and over 75% of renters plan to buy a home.
Apartment occupancy rates remain high throughout many of the country’s markets. Historically when this happens rental rates are pressured upwards which makes home ownership very attractive and new home buyers start entering the market. Although real estate economists and insiders know their predictions depend on the mainstream forecasts of economic growth next year being correct, they speculate that certain trends will be visible in 2013:
- Rising home prices due to the slow pace in new home construction;
- Rising rent rates as more people enter the market and increases occupancy to an even higher level;
- Fewer bargains in the market following the trend already seen in 2012 ;
- More first time buyers;
- Higher home construction costs;
So, in 2013 we should expect a greater number of first time buyers, but what are they looking for? This new wave of first time buyers expect more from their home then ever before. Buyers that are coming out apartments are leaving mainly type A & B units where they are accustomed with large spaces, luxury finishes, technology integration and amenities. College students are coming out of dorms that have been upgraded and made great improvements in comfort and style. Granite counter tops, wood floors and built-ins are becoming more prevalent in the these facilities. Builders and home sellers will have to prepare to offer products, price and promotion that capture this new set of demand in an environment that is still being characterized as a buyers market. .