The Housing Market is Turning a Pivotal Corner
Recently released data by the Wall Street Journal gives reason to cheer. In a time when there is a lot of negativity surrounding the real estate market and the economy it’s great to hear some very positive news backed by undisputable statistics.
In May 2012 home builders began construction on 26% more single-family homes than in May 2011. The number of unsold newly built homes on the market is finally at the inventory levels we had back in 2005.
In the previous four quarters, housing construction played an essential part to economic growth. In the first quarter of 2012, housing construction accounted for 0.4 percent of the overall 1.9 percent growth rate for the country. According to Wells Fargo Securities economist, “Even with the overall economy slowing, the budding recovery in the housing market appears to be gradually gaining momentum.”
As discussed previously, May 2012 showed improvement year over year with a 10% increase in existing home sales. It’s important to note that the inventory of homes currently vacant is at its lowest level since 2006! Mark Fleming, Chief Economist at CoreLogic, added that the reduced inventory of unsold homes is key to the turnaround for the housing market. In the past couple of years, house prices have risen in the spring and then slumped; the declining supply of houses for sale is reason to believe that won’t happen again this year.
It was said all along that in time things would turn around and it seems that time is now. This is very positive news for the economy and people looking to buy or sell a home. The more confidence in the market, the more likely people will be to upgrade to the bigger home they’ve been eyeing or purchase a home for the first time.
What’s your take on these new statistics? Are you more serious about considering buying a home or putting your current home on the market? Sound off in our comment section below. We’d love to hear your thoughts!