Summer Home Sales May Point to Housing Rebound
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Summer has always been a time for increased activity in the Real Estate market. Even this year, one full of declines in most sectors, has seen its share of summer growth with increases in home sales and median home values month over month. The good news has led many to forecast the stabilization of the housing market is near. Yet others, focused on high unemployment and mounting loan defaults, are skeptical.
Allan Glass asks if these numbers are a glimmer of hope or fools’ gold:
“For the first time since 2006 I’m able to report that home prices in the Case Shiller 20-city index have improved month over month. Yes, you’ve read that correctly. In addition to the increased home sales for June, increases in the median home price, also this past June, Case Shiller now tells us that pricing may be stabilizing. According to the Wall Street Journal, ‘most Wall Street economists who discussed the survey focused on the April-to-May rise, saying it represents a significant change in direction. Home prices in 15 of the 20 areas in the survey rose or remained stable.’ The stats were somewhat unexpected, surprising the study’s co-creator Robert Shiller himself. In the same WSJ article Mr. Shiller states, ‘The change in momentum here is very significant.’ The Journal goes on to say, ‘Mr. Shiller’s forecast sustained home-price declines into the next few years, which he said now looks less plausible. He said he expects home prices to remain near current levels for the next five years.’”
Even though the numbers from the last few months mark a significant shift in the momentum of the housing market, some are hesitant to see this change as significant. Higher numbers are expected during the summer months, and to show growth during that time is normal, analysts warn. To really be able to say recovery is on the way, the sales increases will have to continue for a few more months.
Click through to read Allan Glass’ full post.
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