Housing costs decline, however property sales are increasing

A rise has been noted in national home sales, but real estate costs are still trending downward. The past year has been volatile for real estate, but more individuals have been consulting with loan loan providers to purchase a home. The low prices are thought to be the reason for the spike in purchases.

Homes becoming an investment

Figures for nationwide home sales from the National Association of Realtors indicate that an increasing number of individuals are purchasing homes, according to CNN. Property sales rose 2.7 percent over January 2011, to a seasonally adjusted rate of 5.36 million per year. There is also a 5.3 percent increase from January 2010 while home sales are higher than over a year ago for the first time in seven months. However, the increase might be bolstered by people who don’t need to go to loan companies to finance a property purchase. About 32 percent of sales were cash purchases. In January 2010, that was only 26 percent of homes. Sales to investors made up 23 percent of sales, which accounted for 17 percent of property sales in Jan 2010.

Foreclosures might have made up difference

The increased number of cash and investor purchases likely is because of deep discounts available on foreclosed properties. Distressed properties, in accordance with Bloomberg, accounted for 37 percent of January 2011 home sales. The very low costs have to do with the loan corporations. They do not want their spreadsheets showing too several foreclosed properties. Paying out of pocket for property values doesn't tend to take place very often. This is even for homes sold at half the worth they would be at in a great industry. The median property price has declined 3 percent since January 2010, to $158,800.

Lower property costs still

USA Today states that the metropolitan areas are having home values drop drastically. Drops occurred for almost all of the cities tracked by the Standard & Poor's Case Shiller Index. Only one of the 20 cities didn't report drops in prices. Property costs did not go down in Washington D.C. Areas with inflated real estate values such as Arizona, California and Florida have experienced the worst in drop, but southern states like Mississippi and Alabama are also experiencing price declines. Economists think that 2011 could be a year of recovery for homes with the rise in sales.

Citations

CNN

money.cnn.com/2011/02/23/real_estate/january_home_sales/index.htm

Bloomberg

bloomberg.com/news/2011-02-23/sales-of-u-s-existing-homes-climb-to-eight-month-high.html

USA Today

usatoday.com/money/economy/housing/2011-02-22-home-prices_N.htm