Recovery In Sight?
Why Home Sales Will Rise This Year. Lawrence Yun, Chief Economist of National Association of Realtor, tells us that at least through 2011, improving market developments should outweigh the negative impact imposed by Washington policymakers. The first quarter ended with existing homes selling at an annulaized pace of 5.1 million compared to last years 4.9 million.
The remainder of the year should be better still for the following reasons:
. More Jobs
. Rising Stock Market Wealth
. Continuing High Affordability Conditions
. Home Values At Historically Justifiable Levels
. Investors Looking To Hedge Against Inflation
. Foreigners Buying US Homes On The Cheap
Other contributing factors include:
. Higher Bank Profits that should lead to more desire to lend money
. Reduction to market friction as lenders short sale approval processes
improve and appraisals will become less of an issue.
Still lurking around the corner are higher gas prices; policy makers talking about putting an end to guaranteed mortgages and requiring minimum down payments of 10 to 20%; and there will be more atempts to chip away at the mortgage interest deduction by invoking class warfare — the “let’s go after the rich” approach.
Stay tuned. We will keep you posted.
