The US housing market is picking up and one set of analysts say prospects look good through 2013 for property investors and home owners.
The prediction is being made by Freddie Mac, the federal home loan mortgage corporation, who say long-term mortgage rates will stay low for at least six months before tipping up before the year end.
The US mortgage rate will, however, remain below 4% for the year.
The agency, which is a big buyer and guarantor of mortgages, says house prices will also increase in the New Year by 2-3%.
This growth will come from buyer demand not being met by new home construction.
The number of unsold properties will also drop to a 10-year low as the housing market picks up.
A spokesman for the firm said: “The number of new homes built and sales have improved over recent months, giving developers, buyers and sellers more confidence in real estate.
Backlog concerns
“A year ago, everyone was concerned about the backlog of properties that were not selling and feared this stagnation would pull the market down.
“Now, the market has turned about and improving enough to contribute to the recovery and growth of the economy.”
Freddie Mac say it will be just as difficult for American families to get a mortgage because lending criteria was tightened after the housing collapse of 2008.
They say the bulk of mortgage lending was to families refinancing mortgages in 2012, a demand that was fuelled by low interest rates.
With fewer families refinancing in 2013, Freddie Mac says it expects the number of accepted mortgage applications to drop by 15%.
Housing starts up
To counter this, the firm says there will be a slight increase in permanent financing for newly built apartment buildings and there will be an increase in property transactions.
Their optimistic outlook is underlined by the National Association of Home Builders which says that US home builder sentiment has risen to its highest point in six years.
And official figures show that construction of residential properties has begun to pick up.
The US Census Bureau has also revealed that for the first three quarters of 2012 the number of private homes completed rose by 8.9% on last year.
And the number of housing starts has increased by an impressive 26.7% to 582,500 starts this year. Year-on-year, there are 4.2million more houses under construction in the US than previously.
