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2015 Real Estate Economic Outlook by Amanda Howard

The key factors expected to drive the U.S. and the greater Huntsville/Tennessee Valley real estate markets in 2015 include stronger economic growth in the U.S. overall and continued accommodative monetary policies. We have now moved beyond the downturn and are at a point of seeing moderate to strong economic growth in the real estate industry.

When looking at the forecast for the upcoming year, I always start with growth in the job market. The U.S. job market overall has had strong upward movement this year and the Tennessee Valley has been one of the shining spots affected by this. In recent years, we’ve seen a strong emphasis by local and state leadership on encouraging business development in our area and continued efforts to solicit companies to relocate or expand into the Huntsville/Madison, and Tennessee Valley areas. These efforts by our local mayors, chamber of commerce leaders, and our governor have led to many exciting developments this year and leading into the new year.

We are currently in an environment where the economy is growing at its strongest pace since the global financial crisis while long-term interest rates are holding at record lows. A combination of these factors with the decrease in oil prices and the increase in job growth results in a golden moment for real estate in the Huntsville and Tennessee Valley areas.

We currently have both novices and financially savvy investors reaching out to us right now as they see the birth of this exciting year ahead filled with opportunities locally. The facts and reports are out there for everyone to see and I am not sharing anything that is not public information. However, one must read and digest this information to realize the opportunity on the horizon.

As I review the data released and make my projections for interest rates in 2015, I, along with most economists, am quite surprised that the rates have stayed this low throughout 2014. Most predicted the rates would be somewhat higher by this time of year but the slowdown in global economic expansion is leading investors to seek safe assets. These factors are helping to keep mortgage rates at low points. As the pressure eases into 2015, the federal funds rate is likely to be raised which could inch mortgage rates closer to 5% by mid 2015.

As for the projection of home sale prices for 2015, I do believe we will see increased prices but not comparable to what we have seen in the past couple of years. Rather than double digits, I believe sales price growth will be in the mid-single digits. This price growth projection is dependent upon whether or not the inventory, and in particular new construction, will come online and remain stable in production. Our current monthly inventory rate is strong and leaning towards a buyers market. However when you review this past year, you’ll notice inventory has lowered as purchases are remaining steady. New inventory is not increasing enough for expected demand.

Job growth or strong economic boasts of 2014 in Huntsville/Madison area included the following:

  • Boeing expansion
  • Calhoun Community College expansion
  • Intergraph new building
  • Town Madison retail/commercial development
  • Remington
  • Cabela
  • Torch Technologies wins $70 million dollar project
  • Navistar
  • Whole Foods

….And many more

This Week’s Closings, Congratulations!

Ms. Amanda Honeywell

Ms. Janet Phillips

Mr. Thomas Hines of J.E. Home Development

Ms. Sheila Moore

Ms. Elfriede Couch

MR. Ivan Fernandez

Mr. and Mrs. Raymond Berry

Ms. Carolina Marlow

Mr. Juan Suarez

Mr. Christopher Phillips

Mr. Donald Tabb

Mr. and Mrs. Christopher Walters

Mr. Cody Dennison

Ms. Emily Stephens

Mr. and Mrs. Michael Dyson

Mr. and Mrs. Jimmy Pleasant Jr

Mr. and Mrs. Joseph McGinty

 

This Week’s New Listings For Sale:

6705 Station View Drive, $239,900

109 Jane Drive, $119,900

2726 Gurley Pike, $550,000

4500 Colewood Circle, $899,900

122 Hidden Creek Drive, $319,900

114 Galt Lane, $269,900

2404 Sugar Tree Place, $275,000

119 Cove Pointe Way, $189,900

2102 Rosebury Lane, $258,000

1800 Lydia Drive, $175,000

10014 Dunbarton Drive, $134,500

116 Sunshine Drive, $125,000

155 Clover Ridge Drive, $229,900

100 Hannah Marie Place, $179,900

1804 Pettus Circle, $169,900

 







 

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