Home prices are projected to rise by just under 1 percent nationwide in the second half of 2012 and Nevada County should keep pace with the national average. The inventory of homes available in the foothill region is drying up and prices are beginning to make a turn.
The report, titled The Shifting Nature of U.S. Housing Demand, stated investors who buy rental properties are leading phase one of the recovery, as opposed to buyers who purchase properties as their own residence.
The rate of returns of T-bills are currently low and their prices are high and when comparing the government guaranteed bill as an investment to that of real estate, which has a much higher rate of return accompanied with beaten down values, large investment firms are seeing value.
In 2013, prices will rise by 1.5 percent and up another 2.5 percent in 2014.
For the second phase, home prices will increase 3 to 3.5 percent between 2015 and 2017.
During the first phase, the demand for rental properties will come from young people hit hard by the recession and immigrants.
The housing recovery will come in a two phase process as reported by dsnews.com, Click here for the full story.
“Over 80 percent of Americans in recent surveys still agree that buying a home is the best long-term investment they can make. What will be intriguing to watch is how their aspirations around home ownership are affected by this period of extended austerity (In economics, austerity refers to a policy of deficit-cutting by lowering spending often via a reduction in the amount of benefits and public service provided),” he said.
According to the report, about $7 trillion in American wealth was lost when home prices dropped 30 percent after the housing bubble burst.
As investors buy up the oversupply of homes to take advantage of low prices and rising rents, the report also predicts that this will lead to the absorption of the existing surplus, which will clear by the start of 2015.
Then, phase two will begin with higher home prices and a return to home ownership.
According to the report, currently, 11 percent of homeowners say they would like to sell their home, but about half of these homeowners say they aren’t listing their property because they won’t get the price they want.
It is predicted that once prices rise by 3 percent in 2015, homeowners will start to return to the market, increasing the volume of home sales.
Credit will also become more accessible as standards ease, leading to more renters to become buyers. The report stated a crash in demand for rental properties is unlikely. Therefore their is a floor in the market.
According to the report, about $7 trillion in American wealth was lost when home prices dropped 30 percent after the housing bubble burst.
As investors buy up the oversupply of homes to take advantage of low prices and rising rents, the report also predicts that this will lead to the absorption of the existing surplus, which will clear by the start of 2015.
Then, phase two will begin with higher home prices and a return to home ownership.
According to the report, currently, 11 percent of homeowners say they would like to sell their home, but about half of these homeowners say they aren’t listing their property because they won’t get the price they want.
It is predicted that once prices rise by 3 percent in 2015, homeowners will start to return to the market, increasing the volume of home sales.
Credit will also become more accessible as standards ease, leading to more renters to become buyers. The report stated a crash in demand for rental properties is unlikely. Therefore their is a floor in the market.
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Scott Hopper - Realtor 530.477.2277 |
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