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Real Estate Market: Where is it heading?

By kevin | August 20, 2008

When the controversial housing rescue proposal was signed into law last month, many analysts and experts wondered if the timing was right. After all, the market must hit rock bottom first before it can fully recover from the foreclosure crisis.

So, are we there yet?

Last week, the pending home sales index jumped to 89, which is actually the highest index since October 2007. This means that buyer confidence is indeed growing and many of these savvy individuals are taking advantage of the affordable prices as well as large inventories of properties for sale including foreclosure homes.

Aside from this, there is growing activity in the lower price range market in terms of months-of-inventory. Market conditions in cities like Sacramento are surprisingly favoring sellers over buyers. Although this is considered to be bad news for those who are trying to sell these high-priced properties, it only shows that the housing market is clearing up in the bottom.

Many experts and analysts also believe that foreclosure filings are slowing down as evidenced by the 3% decline last June compared to May. Even though the numbers shot up in July, there is a great possibility that foreclosure filings will stabilize by the year’s end.

Whether you are interested in selling or buying, you should be updated with the local market conditions. Knowing whether it is a buyer’s or seller’s market can mean a huge difference. For instance, buyers will enjoy better incentives and bigger discounts if market conditions favor them. On the other hand, sellers will enjoy 100 percent of their asking prices as well as multiple offers if the conditions are just perfect for selling.

If market conditions are favoring buyers over sellers, it could mean that the local market is approaching bottom and you should act accordingly.

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