The real estate market has been falling for a few years now. In the last year, the best housing markets were actually flat, where prices of homes didn’t either increase or decrease and home sales stayed pretty steady with previous year’s sales.
This means that the rest of the market was crashing and burning. Many communities around the country had homes foreclosed on because of bad financial practices by mortgage lenders, and possibly some real estate brokers. Suddenly, there were many homes whose values weren’t being matched by the amount they were paying in mortgage, and in some cases, people abandoned their homes because banks wouldn’t renegotiate with them to try to bring things into balance.
That’s why it’s finally nice to see good news being reported in some areas across the country. We wouldn’t have seen news like this even a year ago. And, although overall we’re still not sure if the housing market is truly ready to rebound for everyone, these communities give everyone else something to look forward to.
For instance, Florida’s housing market has been hit hard by bad loan practices and bank closures. Therefore, it’s with glee that the Orlando Regional Realtor Association released figures showing that they had sold 38% more homes in May than they had in April, and 44% more than the same month the previous year. They did temper the figure by mentioning that most were bank owned or distressed sales, and that home prices overall still dropped by 38.5%, but at least something is improving. That, plus more than double the number of homes sold are waiting to be closed, which they believe indicates an improving market.
The Des Moines, Iowa area is also reported nice growth numbers. Though the overall figure from last year is down 4%, May of this year showed a 21% increase over April’s sales figures, including an increase in price of homes being sold. That increase was 10% higher than last year, 23% higher than April. They believed most buyers were moving up in house rather than being first time home buyers, but still believed the $8,000 tax incentive was greatly helping.
Even the Detroit area, which has been seriously ravaged financially by the collapse of the auto industry and manufacturing overall, showed a 13% increase across its county, including a 10.7% increase in May over last year’s figure. Pending sales in Detroit are down around 8%, but for the rest of the county the lowest figure is the city of Wayne at 9.2%, with the high being 39.4% in Macomb. In this area, the sales are being attributed mostly to first time home buyers.
This shows that there are areas around the country which were in a distressed state that are readily showing signs of some kind of recovery. One can only hope that the rest of the economy shows the same kind of growth as real estate seems to be showing, because that’s the only way that home sales can increase even further.
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