Don’t Bet the Farm on Rising Home Prices

The slight recovery seen in the housing market over the past year has given sellers hope. However, as the saying goes, “Don’t bet the farm on it.” While this upturn in housing sales has many buyers feeling hopeful again, it isn’t expected to last long at all–at least not yet. As more foreclosures are expected to hit the market again, especially in Phoenix, it’s not to exhale just yet. The index put out by the National Association of Home Builders (NAHB) predicts the rise and fall in housing prices. In 2005, this index peaked, indicating that home prices would peak–not too long before the big housing boom in 2006. In 2008, about six months before the down turn in housing prices, the index bottomed out.

According to Robert Shiller, the outlook, based on the current NAHB index, doesn’t indicate that housing prices are rising again anytime soon. However, this index isn’t the only basis upon which the expected outcomes are to be based. Possibly a better indicator would be inventory levels. When looking at the NAHB HMI compared side by side with single family housing starts, we can see that the NAHB does indeed hint at what we can expect, but it doesn’t tell the whole story. We need to take into account the fact that foreclosures are about to be on the rise–again–and consider that to be a heavier indicator of what the market will do.               

If you’re one of the families who may be affected by the repeated downturn in the housing market, or if you’re looking to take advantage of lower prices, call Curtis Johnson team help you. The Curtis Johnson Team is here to help you if you are looking to buy or sell a home. You don’t need to go to the government for help. Instead, go to  www.curtisjohnson.com  or call 1-888-Curtis – J.

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