Housing Market Rebounds After Historic Declines

Factors contributing to surge could last well into 2013, experts say

Did you recently buy one of those boarded up foreclosed homes when prices were dirt-cheap? If you did, good for you! Anyone trying to do that today is going to have a harder time, as the number of houses for sale is at its lowest since before the recession. That scarcity has sparked competition among buyers and led to 10 straight months of price increases. This means the economic recovery is real, housing market experts say. But don’t install the Jacuzzi just yet. Housing industry experts caution that we aren’t on our way back to the housing boom of yesteryear. Nearly 11 million homeowners are still underwater on their mortgages. And while home loan interest rates are expected to remain near all-time lows through much of this year, some economists expect rates to rise and slow down demand. Bottom line? Tread lightly, if you are in the market for a home. (Washington Post)

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Home Prices in U.S. Increase More than Forecast

Optimism, low interest rates, high demand, low supply of homes for sale, all aid in housing recovery.

The housing market is contributing to the economy for the first time in seven years, with home prices climbing more than forecast in October. The S&P/Case-Shiller index of property values in 20 cities was up 4.3 percent since October 2011—the biggest 12-month increase since May 2010. Thirty economists in a Bloomberg survey had projected a median forecast of 4 percent. Record-low interest rates, attractive home prices, and greater optimism are all aiding in helping to drive the housing recovery.

Las Vegas showed the biggest gains in home prices while property values in Chicago dropped the most. Eighteen of the 20 cities in the index showed a year-over-year increase, with strong performance in the southwest and California. However, the job market and the looming fiscal cliff remain factors in driving down economic progress. (Bloomberg)

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