Record drop in home prices is good news.

Services for Real Estate Pros with Law Office of Edward Balcsik

Home prices sank by the sharpest annual rate on record in January, and the pace continues to accelerate.  While for property owners this may be bad news, it is good news for the economy.

The real estate market will not recover until prices bottom out.  There is little reason to invest in real estate if your convinced prices will just keep falling.  What interest rate could possibly make sense if you believe the home will be worth $50,000 less in a year?

The economy will have difficulty recovery with the real estate market adrift.  Too many industries tie to real estate for an economic recovery to be plausible with a dormant or dead real estate market. 

So, while as a homeowner, I am not happy about the decline in prices, as a citizen I am happy to see it happening fast, becasue this get us to the bottom and this is a very good thing

Comments (2)

Paul Francis
Francis Group Real Estate - Las Vegas, NV
Las Vegas Real Estate Agent - Summerlin Homes


Unfortunately we are dealing with loss mitigation departments for lenders that take forever in approving short sales... delaying the correction process and the overall health of the economy.

We would be much further along if they got their act together.

And is a correction process...

Mar 31, 2009 07:28 AM
Chuck Carstensen
RE/MAX Results - Elk River, MN
Minnesota/Wisconsin Real Estate Expert

We are close to the bottom and your right when that happens the fence sitters will get moving. Overall there is a lot of action in the market though.

Mar 31, 2009 07:58 AM