Foreclosures May Be Helping to Stabilize Housing Demand
We’ve all heard the recent rumblings about the housing market beginning to stabilize. Foreclosures in May were up 18% from last year, and believe it or not, some are saying foreclosures are contributing to the stabilization.
Specifically, foreclosures are contributing to lower housing prices, and we’re now seeing an increased demand in home sales. Home resales increased by 2.4% in May – median sales prices, on the other hand, decreased 17% in May. The market provides an outstanding opportunity to purchase a new home at a lower price, and with the Fed working to keep rates low, it’s an opportunity not to be missed.
There are an unprecedented number of homes in foreclosure, and the Idaho real estate market is definitely realizing this. Some are noting a “foreclosure rush,” referring to investors and others in the market for a new home jumping on the chance to buy a great home at a discount. As a result, we’re seeing inventories drop, but median Idaho home prices are still being pushed downward.
The number of Idaho foreclosures, in particular, is still quite high, so even though inventories are starting to slump slightly, there are a number of incredible deals to be had. The bad news is more foreclosures can be driving the median home value down, but that’s good news for anyone looking to make a move. Idaho housing prices will eventually stabilize, so it’s wise to buy a home at a discount when you can, particularly if you plan to remain in the home for ten or more years.
As long as foreclosures continue to rise, we can expect to see housing demand increase as well. But as the number of people jumping in on the foreclosure rush increases, we could see decreasing inventories and may start to see median Idaho real estate prices rise as well. So many variables make a prediction difficult, but one thing is clear: making an Idaho real estate investment is a wise move!
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