Jacksonville Real Estate Market

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Bottom Of The Housing Slump ?

Posted on | September 17, 2010 | No Comments

Many US economic experts’ voices are warning of an impending decline in home sales because the government’s homebuyer tax credits expired on April 30, 2010. Housing experts behind the Standard & Poor’s/Case-Shiller Home Price Indices, the Center for Economic and Policy Research and mortgage lenders Fannie Mae and Freddie Mac are among those voices. To me it seemed like the impending expiration of the federal government’s homebuyer tax credits pushed “would be” home buyers into getting the “free cash” which, at the time, created the inflated demand but then resulted in a numbers setback now. Immediately in May single family home sales fell across the board as did single family home prices. Inventory rose. This rise primarily due to bank owned assets (REO’s) trickling into the market by the ever controlling bank asset managers. The US experienced a 27% drop in existing home sales in July. Meanwhile, in South West Florida foreclosure filings, as predicted, spiked. Pending sales, which are homes under contract that have yet to close and are considered a solid barometer of future activity, were cut in half throughout the nation.

Housing Crisis

Bank Owned Assets

This constant stream of bad news that is plastered on every newspaper and repeated on the nightly news since the tax credits expired has left housing experts all but united in the belief that the downward trends will continue into at least late 2011. Now for some good news. According to the Fannie Mae national housing survey, 70% of Americans believe it is a good time to buy a home, up from 64% in a survey conducted in January. But there may not be enough willing sellers as 83% believe it’s a bad time to sell a home. This survey that Fannie Mae commissioned polled 3,400 adults from June to July. In an interesting finding, of those polled,33% said they would be more likely to rent than own when they move next. Of those surveyed, 47% believe home prices have bottomed, and 31% said prices would increase over the next year. The combined 78% of those not expecting further declines is up from 73% at the beginning of the year.

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