The experts believe the sales bottomed in January, but they believe the prices will continue to decline nationally 9% to 12% this year.
Two negative indicators are the lack of end user demand and the swollen inventory to sales ratio.
Mortgage finance is better than it was 8 months ago. the Mortgage Bankers Association Index of mortgage applications for home purchases is near 10 year lows and down 30%.
There is about a 9 month supply of inventory; in a healthy market the supply would be about 6 months.
Some experts quote a figure as high as 50% of all home sales as distressed homes (short sales and foreclosures). This stat seems a little high to me.
Now for the good news; Housing starts and permits are at a post-war low. Building permits are at less than 1/3 of their 10 year average. Mortgage rates are about 5%, the lowest in 40 years. Falling home prices and low interest rates have created record affordability.
Are there any people reading this that would make a prediction? Agree? Disagree?
I have some concerns nationally; but in my local market we are dong great!
Hello Annie, In my opinion the markets that soared are the one's taking the biggest hit on declining prices. The "Clunker" money give-away is not a wise decision. God help us if the government continues to "think"!
Good Morning Ricki, Glad to read the Hill Country of our great state is doing well! My grandfather always told me to make hay while the sun shines. You get tired but it is a "good" tired. Thanks for your comments.
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