Ten Ways The Tampa Housing Market In 2014 Will Be Different Than 2013
April 14, 2014 by Lois Szydlowski
We all like to be prepared for the worst and hope for the best…that is why we all love predictions. So after doing my research out there for the upcoming year, I have put together what the experts think are going to be the upcoming changes in Tampa Bay Real Estate for 2014. That being said, and not forseeing some economic crisis that could change things, here are a few ways the Tampa Bay Housing Market will be different this coming year:
It will cost more to buy a home in 2014 than 2013, because home prices are expected to continue to rise by double digits.
Mortgage rates will be slightly higher this coming year due to our economic recovery and our Federal Government changing things up again.
Buying a home though, will still be a better bet and cheaper than renting a home/apartment. On average, with rents in Tampa for an economical apartment around $900 a month, with a little money down and decent credit, a mortgage payment can be gotten for less than that. Why pay your landlords’ mortgage?
With home inventory increasing in 2014, due to increased new construction, more existing homes on the market from sellers (seeing the advantages to selling their homes now with the increased pricing) and investor competition has drastically diminished over 2013, purchase choices are numerous.
Some banks have opened up their lending rules with less refinancing of loans happening. With banks understanding their financial and lending risks with the different kinds of mortgages, there may be more opportunities for bank lending.
Repeat home buyers are expected to be the ones buying the most homes in 2014. Investors not seeing the numbers shaping up for them due to the price increases will pull out of the market. First Time Home Buyers, needing to have more money for a down payment, a lower debt-to-income ratio and maintaining a stable job, along with increasing home prices and interest rates, will find it a little tougher to purchase a home. Repeat buyers, who have seen their current property values rise, will have more equity to acquire an equity or credit line for the down payment and with still affordable interest rates, will be the frontrunners in this Real Estate year.
The Rental Market in Urban Markets is becoming big, while the suburban single family home rentals will decline due to the short sale and foreclosure sales are declining. Young people, who want the convenience of living where they work, play and eat, with a less commute time and more enjoyment time, will accelerate this demand for multi-family rental communities in 2014. The suburban single family communities will still be dominant in owner-occupied single family homes.
While Tampa Bay is not considered a “local market” to watch in 2014, due to Florida having such a high foreclosure rate in years past, the “Local Market” scene in undervalued cities around the U.S. is heating up. This means that many people are choosing smaller but vibrant locales to put down roots for a more economical and better quality of life. These local market US cities have seen a recent increase in viable jobs with good income, significant economic success in their localities, followed by real home and business construction activity, that is typical of healthy growing cities. A few of the top 10 that made the list have been making news with their growth for some time now, notably Charlotte and Raleigh, NC; Denver, CO; Nashville, TN; Salt Lake City, UT and Seattle, WA.
Now more than ever, you should be aware of and understand the fees you pay when you buy a home. As each year goes by, and 2014 will get even more translucent, you will be seeing the fees for services that you will be paying for during the purchase process and at the closing table. Here is a list of some of the fees you can expect to see on your final HUD settlement statement at the closing table:
Appraisal fee to determine current market value of your home (required by your lender)
Origination fee of the loan from your lender
Pre-paid interest because mortgage payments are paid in arrears
Pre-paid one year insurance premium for your home insurance
Flood certification or elevation certificate to determine if flood insurance is necessary
Real Estate Tax servicing fee to the county
Credit report fee to obtain your credit scoring
Bank processing fee to underwrite your loan
Recording fee to record the deed in the county of record
Notary fee to have a sworn statement and verify signatures
Title insurance to protect all parties concerning ownership of the property
State and County Taxes on the Deed, Mortgage, etc (Florida)
Be sure to discuss these costs further with your Realtor and/or Mortgage Broker/Lender.
10. It is a SELLER’S MARKET and you will need to be ready to put your best foot forward. Here’s how:
If a home you like just hits the MLS today, you will need to see it today, especially if it is exceptional. There is plenty of buyer competition and Realtors always tell the Sellers that the first offer is usually the best one–so you want to be the first one.
That being said, you need to be already pre-approved for a mortgage, that is talk with a mortgage broker or lender and have your credit pulled, your income and work history identified, your debt-to-income ratio calculated, etc. Bottom line is to make sure you can move quickly to buy the home when you see it.
Make a clean and reasonable offer, that is, do not ask for repairs found during the inspection, home owner warranties, closing costs, etc. while giving the Seller a low ball offer. The seller will likely just move on to the second offer. With other offers coming in, would you work with a Buyer who is unreasonable and acting as if they were the only buyers on the planet?
Don’t be penny-wise and dollar-foolish: If you are asked to put in your final and best offer in a competing situation, do not be afraid to give it your best shot (your best shot is the offer, that if you do not get the property, you will say that you gave it your all and not state that you are willing to go up a couple of thousand extra). A few thousand dollars over the course of your 30 year mortgage will not amount to much in your monthly payment, so go for it.