Has The Housing Market Bottomed Out?
If you have been sitting on the sidelines waiting for the housing market to reach rock-bottom, now may be the time to move. After plunging the last three years, home prices have gotten low enough to entice buyers back into the market. That is starting to stabilize prices and some analysts now think the worst may be over.
A recently released Case-Shiller Price Index, compiled by Standard & Poor’s, shows that eight cities had price increases in May, compared to four in April and only one in March. Chicago, Cleveland, Denver and San Francisco are among the markets posting gains.
Significantly, this is the first time since early 2007 that the composite Case-Shiller index of 20 major cities was essentially flat, instead of down. This is on the heels of earlier reports showing that sales of existing homes rose in June for the third consecutive month. In addition, sales of new homes rose in June by the largest percentage in eight years.
As the economy emerges from recession, the real estate market should continue to improve, although skeptics warn that rising unemployment, another jump in foreclosures or a big increase in interest rates could halt the forward momentum.