Nobody really saw 2013 coming.

Last New Years Day, there was still some question about whether the housing market was solidly in a recovery mode. As the year played out, the questions became less frequent.

Home prices made record gains, moving faster than most economists had predicted. Mortgage rates near record lows brought out buyers whose biggest problem was finding a home to buy — and beating out competing bids. Foreclosures and the percentage of underwater mortgage holders dropped.

The new year may bring some surprises of its own, too, but already we know there are some changes coming that are likely to shape the metro areas real estate market in 2014.

Look back

Home buying will remain competitive, especially early in the year.

Early 2013 shopping wasnt for the faint of heart. Multiple offers on homes and even bidding wars were common, especially in Portlands central neighborhoods.

The first part of this year may look similar, said Brian Allen, owner of Windermere Cronin & Caplan Realty Group in Portland. Buyers know prices and interest rates are going up, while the supply of homes on the market is staying relatively low.

We’re still in a strong seller’s market, Allen said. And when really serious buyers see prices rising and interest rates rising, it really motivates them to make a move.

Investors — cash buyers who are buying to rent or flip the home for a profit — are still active in Portland. Theyll start to drop out of the market as prices rise, but in the meantime theyre still competing with traditional homebuyers, especially on the lowest-priced homes.

Borrowing costs will rise.

The Federal Reserve has been spending $85 billion a month buying bonds to help keep interest rates (including mortgage rates) low and stimulate the economy. But the Fed announced in December it would start to slow its stimulus by about $10 billion a month — at least, as long as the economic recovery continues.

Monetary policy is turning less supportive in 2014, and mortgage rates are already reflecting this change, said Tim Duy, a University of Oregon economist and noted Fed watcher.

The rate on a 30-year fixed mortgage have risen by more than a percentage point from the all-time low of 3.31 percent reported by government-sponsored mortgage investor Freddie Mac in November 2012.

Granted, even another point will be extraordinarily low from a historic perspective. But the rate hikes can put some pressure on buyers at the margin.

First-time buyers are usually shopping right at the peak of their ability to qualify for a loan, Allen said. If interest rates move up 1 percent, it translates to an 11 percent discount to what they can qualify for.

We also received a lesson in 2012 in what can happen when the market tries to predict what the Fed has up its sleeve. Rates spiked in June on the mere suggestion that the Fed might begin to slow its stimulus.

The risk is that financial markets front-run the Federal Reserve and mortgage rates jump higher, Duy said. This could cause some additional volatility in housing markets, possibly leading to a sudden slowdown in housing activity as buyers wait to see if rates drop.

Qualifying for a mortgage will be easier or harder. Or about the same.

Even putting the Feds influence on mortgage rates aside, theres a lot going on with mortgages in 2014.

On Jan. 10, new rules set out by the Consumer Financial Protection Bureau lay out requirements that lenders make a reasonable, good faith determination that borrowers will be able to repay their mortgages. Loans that comply — qualified mortgages, or Q.M. loans — will be protected from legal challenges if they go bad.

The Mortgage Bankers Association reported in December that credit is already tightening in anticipation of the new rules as lenders phase out loan programs that wont qualify. But the CFPB has said 95 percent of loans made today comply with the Q.M. rules.

A lot of people are saying its going to be a huge impact, said Evan Swanson, a mortgage broker with Mortgage Trust Inc. in Portland. For me, in my world, its not going to make much of a difference. At least, not initially.

On the other hand, rising rates may give banks some incentive to widen their net for purchase loans. In 2012, a huge chunk of their mortgage business came from homeowners refinancing into lower interest rates. As rates go higher, that business dries up.

Rising rates means lenders refinance business will dwindle, forcing them to compete for buyers by potentially loosening their lending standards, said Erin Lantz, director of mortgages at the real estate website Zillow .

Price increases will slow.

The record-setting increase in home prices recorded in 2013 is soon coming to an end, most forecasters say.

The Portland area has seen prices 10 percent higher than a year earlier for eight months in a row, according to the Standard & Poors/Case-Shiller home price index. (Its most recent report covers home-price fluctuations through October.)

Thats probably just not sustainable, Allen said. I dont believe were going to have another year of 12 percent increase in price.

The combined effect of rising prices and mortgage rates has taken a toll on affordability. As marginal buyers are priced out, sellers are pressured to lower their expectations.

And the hangover from the housing crash is still lingering, Allen said. Regardless of whether they can afford it, would-be homebuyers are wary about overpaying for a home (and if they arent, their lenders are).

Sellers again have to be spot-on with their asking prices, Allen said. Buyers are still trying to cherry pick.