Wednesday, July 29, 2009

Signs of a Real Estate Market Comeback

The recently released Case/Schiller reports show a modest increase in housing construction starts.

A July 27 Associated Press Article also reported that home sales for June rose at the fastest rate in eight years.

Multiple factors are coming together to create an ideal buying market especially for those whose investment assets are not tied up in existing homes. The turnaround is primarily being fueled by first time home buyers and investors with cash who are taking advantage of factors such as the first time buyer tax credit, low interest rates and low real estate prices.

This unprecedented combination of positive buying factors is leading to the market putting the brakes on declining prices in the low price ranges, and competition due to over ten, twenty, or even 30 bids being submitted on foreclosure properties driving prices upward.

New housing starts should remain modest as the key factor in sustaining the market is existing home inventories and the foreclosure pipeline.
Foreclosures and short sales and still accounting for a significant percentage of real estate transactions.

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