Some Indicators Are Beginning To Show Strength
NEW YORK (AP) — There is a clear trend U.S. home prices declines are moderating — another sign the beleaguered housing market is stabilizing, according to data released Tuesday.
"The stock market bottomed in March and measures of consumer confidence have turned upward. This report shows that these better spirits are also appearing in the housing market," said David M. Blitzer, chairman of the S&P index committee.
Eight of the 20 metro posted price gains from March, with Dallas recording the largest increase at 1.7 percent. And every city except Charlotte showed some kind of improvement month-over-month.
Still, a housing recovery is distant on the horizon. The 20-city index is off almost 33 percent from its peak in the second quarter of 2006, which means home values are now around 2003-levels.
Hardest hit remain Phoenix and Las Vegas, where home prices have lost more than half their value since their peaks.
The Case-Shiller index tracks repeat sales on a specific group of homes in each city. Sales between related parties, such as family members, are excluded.
We are seeing some anecdotal evidence that supports this theory - particularly with newer homes that are in relatively good condition.
A year ago, there was an incredible selection of new construction available - much of it in the form of bank foreclosures. Builders who couldn’t sell their homes in 2007 saw much of their inventory sell as foreclosures in 2008 - and the trend continues.
The selection is not nearly as good right now, as much of the new construction has been purchased - and fewer homes were built in 2007 and 2008, so fewer new homes are left.
Additionally, many buyers are looking to take advantage of low interest rates coupled with federal and state tax incentives - up to $9800 in Georgia - which could further explain the firming of certain sectors of the real estate market.
With energy costs rising - and the fear of additional taxes added to those rising energy prices - consumers are wary of purchasing older, less energy-efficient homes… and that reluctance is reflected in the lower demand for those homes.
If you are trying to time the market in Atlanta, the time to start paying close attention might be upon you.
As always, if you have any questions regarding real estate in the greater Atlanta area, feel free to contact me here.
