The Art of Predicting Housing —
And Everything Else

“It’s tough to make predictions — especially about the future.”

–Yogi Berra

“The trend is your friend . . . until the bend.”

–Stock market wag

If most prognosticators simply extrapolate current conditions — which I believe is the case — does it follow that I think all predictions are useless?

crystal ballOn the contrary, predictions yield a great deal of info.

Just about the present, not the future.

Twin Cities:  the ‘Goldilocks’ of the National Housing Market

If that’s the case, what are industry experts saying about the future  . . . er, current conditions?

Here’s a distillation of what I’m hearing/reading — and seeing(!):

•Mortgage rates may start to rise in the second half of 2013, but are expected to stay below 4%.

•Homes prices nationally will rise 3% to 5% in 2013.  Appreciation in the Twin Cities housing market, which historically tracks national averages, will mirror that rise.*

•An uptick in household formation will provide a tailwind for housing prices, especially in the lower price brackets that appeal to first-time Buyers.

•The percentage of lender-mediated transactions (short sales mirrorand bank-owned foreclosures) will continue to wane.

Hard to argue with any of the above.

The only thing I’d add is, “to understand the future, it’s first necessary to understand the present.”

Happy 2013!

See also,  “Barrons:  ‘Home Prices Headed Up 7%“; “Predicting Home Prices in . . . 2022?!?“;  “2012 Predictions.”

*If “middle of the pack” seems too tepid, instead think of the Twin Cities as the “Goldilocks” of the national housing market:  “not too hot, not to cold.”

I wish the same could be said of the local climate . . .

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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