Housing issues for 2013 © art1art – Fotolia.com

Nick Timiraos’ recent column in the Wall Street Journal offered up his own expert opinion on what we can expect to see in 2013, identifying the five most important housing issues that will affect consumers and real estate professionals alike:

1. Housing Prices Set To Inch Upwards

The WSJ article warns that much will depend on the success of the economy at large, but should this improve and the unemployment level decrease, many of the housing market’s biggest problems – such as foreclosures, the large number of homeowners underwater, and tough credit standards – will likely ease somewhat, paving the way for home prices to inch upwards even more.

2. Inventories to Grow

In order to meet the level of demand, Timiraos predicts that home builders will take production up another notch, whilst more homeowners may decide that the time is right to sell as housing prices continue their upward trend.

3. Rising Demand as Home Prices Rise

With home prices set to continue rising throughout 2013, the WSJ predicts that buyers will show increased urgency and make more efforts to close on deals sooner.

4. Lending Standards Remain Tight

Unfortunately for first time buyers, it’s unlikely that will see credit becoming any more accessible in the year ahead. The WSJ believes that new credit regulations will likely lock banks into their current “defensive posture” when it comes to lending – if anything, standards could become even more strict.

5. Shadow Inventory to Shrink

But only a little. The WSJ suggests that banks may look to speed up the process of foreclosure in those markets that already have large backlogs, but even so they are likely to remain cautious so that markets do not become inundated again.

We should note that all of this is nothing more than speculation of course, and while most economists are tentatively predicting an improvement in the economy overall, the housing market could quickly take a turn for the worse if these predictions don’t pan out. The WSJ reminds us that housing is still very fragile, and much depends on whether or not lawmakers can agree on a compromise to avert the “fiscal cliff”.

Image courtesy of DonkeyHotey

Four real estate organizations recently did a national survey and the results were fascinating.  All four independent surveys showed the same trend.  For the first time in recent memory the issue of national housing was one of the hot topics on the minds of potential voters.

Julia Reynolds of Realtor.com, which is the website for the National Association of Realtors, said “We were very surprised just how passionate people are” about housing issues.  The most significant segment of the population that were concerned with the housing crisis were “Millennials”.  These are a segment of the population born after 1982 and also known as the Internet Generation.  Their concern about this topic makes sense, since this group’s oldest members are just now entering the housing market and discovering how difficult it has become to own a home.

In a similar poll done by HouseLogic, another Realtor run website, the housing crisis came in as the second most important topic in the upcoming election after jobs.  However, surprisingly housing ranked significantly higher on the minds of potential voters than other hot topics like healthcare, the environment and national security.

More than fifty percent of the people surveyed by Yahoo Real Estate said they wanted the government to take more actions to help people who are either in the process of, or at risk of losing their properties.  The percentage of people who thought the government has done enough to solve the housing crisis was less than twenty five percent.  Others had no opinion one way or the other.

Similar to the HouseLogic survey, Trulia.com’s poll discovered that the economy and recession came in first on the minds of voters.  But more than seventy five percent of the people surveyed in the poll agreed with the statement that the government has not done enough to encourage home ownership and help those currently facing foreclosure.

When all of these respondents were asked about specific policies those who registered as either Democrat or Republican both had the same viewpoint.  More than seventy five percent of members of both parties said the government should make it easier for homeowners who are upside down on their mortgages to refinance, while over sixty five percent revealed they want policymakers to work with lenders on loan modifications that reduce the principal balance owed on the loan, so that families can have an easier time making payments and saving their houses.

Eighty two percent of the people surveyed in the Realtor.com poll think it is critical to the national economic recovery that the government do something to help people avoid foreclosure and stay in their homes.  They feel this issue should be the top priority for whoever is the next incoming President and that it should be addressed within his first one hundred days in office.

With less than six months to go before the election, any worsening of the housing market could make voters push this platform onto the candidates even harder.  The bipartisan opinion right now is that if President Obama were to lose this election it would not be because of the poor economy but moreover for his multi-billion dollar bailout of the lending industry which did not help homeowners avoid foreclosure.