Has the Housing Market Turned Around?

Looking at the housing market in a realistic sense many economists and financial institutions have come to the conclusion a recovery is in the process. Nothing could be further from the truth.

Prices Fell 4% in 2011

Home prices continue to plummet in early 2012 ending 2011 on a 10 year low declining 30% since the housing bubble topped out in June 2006. Does that sound like a recovery to you?

Pick Up in Sales?

Economist Paul Dales who forecasts the financial future for 'Capital Economics' elaborated in a recent newsletter to clients that higher prices for housing should not be the sign we look for in a real recovery. The overall gain in housing sales is the real indicator we should be focused on.

Homes Have Become Harder to Buy

Housing prices have gone up ever so slightly though it still takes months to find a buyer and another month on average to close. This is because of all the recent hoops home buyers have to jump through lately including the astronomical figure of 5% - 20% down on homes under $417,000. 100% loans are just not available anymore, depending on your credit scores documented proof of income, length of employment; it would still be hard to borrow 80% - 95% even with outstanding credit.

Market Low of 4.1 Million

Sales have crept up ever so slightly since the housing bubble burst of 2008 and the ensuing collapse that left a market low of 4.1 million sold for that year. 2011 home sales spurted up to 4.26 บ้านมือสอง กรุงเทพ million compared to 4.19 million in 2010. There will be heavy opportunities to invest in the coming months because of foreclosures and pending short sales by the banks.

3 Million Foreclosures Coming

Federal and state officials just recently settled a $25 billion deal with five banks to close investigations into the abuse of the foreclosure rules and regulations. The stalled out agreement just ended, after a year of negotiations, will most likely add at least 3 million foreclosure homes to the market in the next couple of years. Not to mention the problems related to putting that many families on the streets due to their now not having a place to live.

Federal Reserve to Raise Interest Rates

If the Federal Reserve happens to jump the interest rates up later this year experts have speculated this potential damaging move would make the cost of buying a home a lot more expensive when you compare it to stagnant incomes now and inflation eating up savings. As the average paycheck shrinks due to inflation, gas prices skyrocketing, cost of food going out of sight, the Bush tax cuts not being renewed and unemployment still a problem, is it any wonder the natives might be getting a little restless!