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Traditionally, this time of year sales activity slows and we can all catch our breath, but not so much this season. Although sales will be less than peak spring and summer months, they are unusually strong for this time of year. The annualized sales rate is actually higher now than it was this past spring, meaning there is even stronger buyer demand going into the new year than there was this year (and this year was pretty strong).

Listing inventories continue to shrink, as the number of new salable listings entering the market is not keeping up with the number of homes being sold. All indications point to 2013 being a strong year for home values with both Median and Per Square Foot prices up 20%+ over the past year, pending sales up 38%, home inventories down 25%, Days on Market down 24% and foreclosure sales down over 50%. The combination of great rates, prices and six years of pent up demand is causing an extra boost in buyer demand. Because of that, expect appreciation rates to be strongest over the next 18-24 months, and then settle back down to a more normal (but still strong) activity level. Which means an expiration date is on that sweet spot of both strong appreciation and low interest rates, so anyone who is anticipating selling in the next 3-5 years should be evaluating their housing needs in 2013.

Buyer’s lending standards continue to be a challenge, so here are some simple suggestions to help minimize mortgage loan frustration:
1.  It’s never too early to get pre approved. Preparation is key to a successful transaction.
2.  Once pre approved, don’t open new debt and don’t make any large purchases.
3.  Large deposits are watched very closely. Deposits going in checking and savings accounts need to be accounted for (large means anything over $500).
4.    Bring everything asked for by the Loan Officer up front at the time of application.
5.  As underwriters check and double check files, be prepared for additional conditions after approvals and some details needed within the last few days of the transaction.
6.   Often, if the transaction has been in place longer than 45 days, ask which information will need to be updated before closing.

I have had requests for an updated Rent vs. Own analysis, so here it is using current rental and mortgage rates. Even if values remain flat over the next seven years, which is highly unlikely, owning a home is still an outstanding investment.