Title: Housing Market Update
The latest data shows that some areas of the country may have finally hit the bottom of the housing market slump. For the first time since 2007, a composite index of 20 major cities was flat, rather than down. Prices are low enough to attract buyers, which leads to price stabilization and recovery.
Eight cities showed home prices increasing from April to May, including Chicago, Cleveland, Denver, and San Francisco. Charlotte and New York City were still flat. In the same study from April 2009, only four cities increased; in March, it was just one.
Another study reports that areas showing signs of stabilizing include parts of California and the Washington, DC suburbs of Northern Virginia. The hardest-hit areas, including Florida, Detroit and Las Vegas, are still quite depressed.
Earlier reports revealed that sales of existing homes rose last month for the third consecutive month, and sales of new homes increased in June by 11%--the largest percentage gain in eight years.
A research firm showed the number of buyers in the second quarter who actually moved into their newly-purchased home declined by 2.6 percent. This could be a significant predictor in future months. If speculators and investors are purchasing inventory, a large number could be back on the market soon.
While these numbers do not represent the country as a whole, they are certainly indicative of movement in the real estate market. Investors will want to keep a sharp eye on prices in their targeted markets—they could be going up soon.
Sources: The Wall Street Journal, The New York Times