If your inbox is like mine, it’s chock full of predictions and forecasts for 2014. If recent history is any guide, a sizable percentage of them won’t come true-perhaps that’s a result of living in extraordinary times. However, here are some things that you can be certain won’t happen again in the year ahead.

1. Inventory shortages like the one last year are history.

Unusually conditions came together last year to create a real estate perfect storm. Millions of potential sellers underwater on their mortgages when the season began. Millions more were in positive territory by prices hadn’t risen enough to generate enough profit to move. Four million houses once owned by families are no longer on the market; they’re now single family rentals. Couple that with a generation of first-time buyers scared stiff by reports of soaring prices and rates and you got a recipe for a real estate pandemonium, which happened in some Northern California markets.

Not a chance of a repeat in 2014. Rising values pushed another 30 percent of homeowners above the surface last year. They are continuing to rise even as inventories are normalizing, though not as quickly. Markets across the nation have returned to better balance between supply and demand.

2. If interest rates dip below 3.5 percent, its time to move to China.

Rates on a 30 year fixed rate mortgage bottomed out a year ago below 3.5 percent and they remained low through the first of this year despite widespread predictions from the Mortgage Bankers Association on up that higher rates were right around the corner. A crappy economy kept folks guessing until June, when the cork popped out of the bottle and rates blew above 4 percent.

With the economy starting to return to life and the Fed talking about tapering, not if but when, it’s pretty obvious that rates aren’t going back and the 3 percent days are a thing of the past, unless we hit a depression. The question to ask today is not if rates will rise, but how far and how fast.

3. Discounted deals on distressed sales are a thing of the past in the sand states, except for Florida.

The guys who hang out at auctions in Phoenix and Vegas long ago said goodbye to the big discounts on forecloses that made rehabbing and flipping almost a no brainer. The hedge funds got the blame but the real culprit was tight lender standards. No more toxic loans, no more toxic foreclosures. In 2014, however, it will still be possible to do some flipping in places like Jersey City, Albany, Columbus O, and Baltimore where judicial state laws extend the foreclosure pain on homeowners and lenders alike. As for Florida, please email me if you understand the Florida foreclosure picture. I think only Jack McCabe can explain it to the rest of the nation.

http://www.realestateeconomywatch.com/2013/12/four-big-things-in-real-estate-that-wont-happen-in-2014/