Cover story: Next year will ‘start out fast’

“This year I’ve had to fight on behalf of my buyers more than I have since 2005,” Mr. Rathgeber said. “And when we fought other buyers, we only won because we offered more than the asking price.”

That is precisely why home prices rise the most in the spring, making it the best time to sell a home.

Those who might want to list their home as a short sale, however, need to wait a bit to see what Congress is going to do. The Mortgage Forgiveness Debt Relief Act of 2007 is scheduled to expire on the last day of 2012. Unless Congress did something after today’s paper went to print, sellers of short sales in 2013 will have to pay taxes on their canceled debt.

“So sellers of short sales are nervous, and short sales could virtually disappear in 2013,” Mrs. Haskins said. “Many of these people would go to foreclosure instead, which is a long and costly process in Maryland and the District since they changed their foreclosure laws recently.”

The other uncertainty about 2013 is mortgage interest rates. They have been so low for so long that many people assume 4 percent is normal. Higher rates could deter buyers.

“I don’t think we’re going to see a ton of movement in rates early in 2013,” Mrs. Haskins said. “They are at an amazing level right now. The problem is, people think this is the norm. I remember when I had a mortgage with an interest rate of 16 percent!”

Mortgage interest rates have remained low, in part, because the federal government has been buying its own bonds in a program known as “quantitative easing.” This quantitative easing cannot go on forever. When it ends, mortgage interest rates likely will rise, area real estate experts say.

“Eventually rates will have to go up, and when [they do] it might put a damper on real estate for a while,” Mr. Rathgeber said. “On the other hand, this quantitative easing could bring on inflation at some point, which will cause the value of homes to rise.”

And that often is a boon to real estate, because higher home values encourage homeowners to think about selling their property and buying something more expensive.

Still, some real estate professionals have been reluctant to acknowledge that home prices are recovering.

“We’ve seen more appraisal problems than in any year I can remember,” Mr. Rathgeber said. “A third of my transactions this year have had some kind of issue with an appraisal.”

Lenders require appraisals of a home’s value to make sure they aren’t lending too much money to the buyer. Inflated appraisals contributed to the recent meltdown of the real estate market. Nowadays, appraisers are much more cautious.

“Not one appraiser has been willing to change his appraisal this year, not by a single penny,” Mr. Rathgeber said.

“It might be a little better next year, because the appraisers have to, at some point, recognize that prices are actually going up. They have been in denial, like they felt they had a responsibility to appraise low.”