Zillow released some fourth quarter housing data, and makes a prediction that home appreciation might be slowing down from a hot 2013. Here is an interesting quote from Dr. Stan Humphries found in an online article on Zillow's website.
“The housing recovery is entering the middle innings after an incredible run in 2013. Below the surface of last year’s market, a number of unsettling trends started to emerge as a result of rapid and ultimately unsustainable appreciation, setting up a bit of a mixed bag for 2014,” said Zillow Chief Economist Dr. Stan Humphries. “Affordability issues will help put the brakes on many markets that saw huge appreciation rates, like California and the Southwest, creating volatility that could potentially cause whiplash for home buyers and sellers. At the same time, we expect more homes to be available this year as more sellers enter the market and more homes get built, and a decline in investor competition should make for a more hospitable market for many buyers.”
I believe that as long as mortgage interest rates are below 5% on a 30 year fixed, buyers are still going to have a strong presence in the Houston market. Once rates begin to rise, it will be harder for buyers to be able to afford houses at higher price points, and then appreciation will slow down or reverse.
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