The upcoming year could be very unsettling for Real Estate. The old year goes out with an old man, the new year with a newborn.
Well, this year that newborn could be playing with a rattlesnake.
Several factors to consider. The Fed just announced it is going to “reduce” its buying in the securities market. The Fed will reduce its rate of purchases to $75 billion monthly, with a split of $40 billion in Treasury Securities and $35 billion in mortgage-backed securities. From 85 billion a month to 75 billion.
The last time the Fed even hinted at this, interest rates jumped 1 full point and home buyers left the market like a herd of wildebeest’s being chased by a lion.
Secondly VA mortgage requirements are scheduled to become stricter starting in January. The fly in the ointment however, is the sequestration cuts in the Department of Defense budget. Nobody knows for sure, but rumors are that tens of thousand of job cuts are on the docket this year.
If you are a potential buyer, investor, or looking to sell your house soon, these upcoming changes are something to be considered.