Back in January of this year, before the major media mentioned it, I told readers that bidding wars had erupted over short sales and foreclosures in South Florida. I also mentioned that these properties were often selling above their asking prices, and that home prices seemed not only to be stabilizing, but on occasion, to be rising. In addition, I noted that home sellers were conceding less and less on price.
We are always pleased to see that the trends I note are substantiated at later dates by statistics cited in various well respected media.
Recently, real estate organizations around the country noted that prices had risen on an average of 1.6% on a nationwide basis. Today, none other than Robert Shiller, (of the Case-Shiller Index), writing in the New York Times, stated that the 2009 results from June and July in the Standard & Poor’s/Case Shiller 10-City Composite Home Price Index showed a rise of 3.6% between April and July. He also indicated that he was surprised by this price increase, because in June he suggested that the declivity in home prices had years to go before it ran its course.
In Las Vegas, one of the cities hardest hit by housing declines, the median price for a single-family home moved up to $138,000, a gain of $2,500, which is an increase of 1.8 percent. Although Las Vegas statistics show that the median price is still 29.2 percent less than it was a year ago, prices are slowly rising from their depths.
In addition, if signed contracts are not included in the count, the inventory of unsold single family homes in that city has fallen to less than a three-month supply. It should be noted that a stable market usually has a 6-7 month supply of homes.
Bloomberg news says that media prices of California homes are set to rise 3.3% by 2010, because an influx of first time buyers and investors are flooding the market. While the California Association of Realtors had predicted a 13% increase in homes sales this year, they were proven wrong by much stronger figures. Sales actually rose 23%.
In Phoenix, the market is moving into recovery. The Arizona Republic says property prices are on a slow upswing and foreclosures are on their way down.
In South Florida, prices are holding steady, and competition for homes in the lower end of the market remains fierce. We continue to see multiple bids on desirable homes. This competition is driven by first time home buyers in search of bargains, and the same cash rich investors who pushed prices into the stratosphere during the last real estate frenzy.
Because there are many more homes already in, or on their way into foreclosure, single family prices will remain relatively stable for the moment, and increases will remain slight. But don’t be surprised to see more and more homes in the under $350,000 range going at asking price and slightly above. Seller concessions may become a thing of the past for homes selling at this lower price point.
This rise in single family home prices, no matter how slight, indicates to buyers waiting on the sidelines that the bottom of the real estate market has quietly made its entrance onto the economic stage. Applause will come in the form of rising real estate investment.
Written by Marc Jablon, Realty Associates
marcjablon@yahoo.com / 561 / 213 – 6139
www.marcjablonhomes.com/
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