U.S. Housing Market on the Rise

May 17, 2012 / Russell Legato, Residential Property Analyst

U.S. housing, after a five-year slump, is in the process of recovering. Sales are rising although the sale prices are not always what the realtors and home sellers are hoping for. Overall, as a nation, the industry is definitely making a recovery that seems long overdue.

U.S. Housing Market on the Rise

There are three major contributing factors; the prices are reduced on the properties, the mortgage rates at an historic low and rental units are growing less affordable as demand for them increases due to foreclosures. One fact will never change and that is, families have to live somewhere, whether owning or renting. Crowds of people are attending open houses for single family homes, while investors are snatching up low-priced foreclosed properties to offer as rental units.

All these factors, coupled with the fact that prices are beginning to rise on the homes for sale in many areas, make it an opportune time to buy a home. All involved in the industry are confident that the upward trend is going to continue.

One realtor reported a 35 percent increase in prospective buyers over the year 2011. As fear is allayed, the buyers come out to shop. The spring season began in January and February with ideal weather bringing people out to tour houses.

As for new construction, there was an increase in building permits, which was higher than any time since 2008. Houses for sale that are not in danger of foreclosure comprise about two-thirds of the market. Price gains were made in thriving areas such as New York and Washington, and also in depressed areas such as Phoenix, Arizona.

Miami has seen a 14 percent increase in the average sale price of a single family home. Phoenix is up by 13 percent and Pittsburgh by 9 percent.

Wells Fargo and JPMorgan Chase both report that more individuals are taking out mortgages.

However, some areas, such as Atlanta, central California and the suburbs of Las Vegas are stagnant. Others, Cleveland for example, see a drop in home prices.

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