Has the Real Estate Market Finally Found a Bottom?
Housing market shows small signs of a rebound.
May 27, 2009 -- The "great recession" began with the collapse of the housing market, and economists from Florida to California say it's unlikely to end until home sales and prices stabilize.
But now, after nearly two years of steep declines, there are small signs that the housing market may be close to finding a bottom.
Nationally, existing home sales rose 2.9 percent in April from a month earlier, according to the National Association of Realtors.
Though sales were down 3.5 percent overall from a year ago, home sales rose modestly in the South and shot up 11.6 percent in the Northeast, the realtor group reported.
"I think the national numbers are showing that we may be seeing a bottom," said Thomas Lawler, a real estate economist with Lawler Economic and Housing Consulting. "But again, it's not universal, it's not everywhere across the country."
In New Rochelle, N.Y., a suburb of New York City, realtor Phil Faranda said volume has noticeably increased as buyers hunt for bargains.
"People are coming out because they feel they can get a good deal for the first time in quite a long time," he said.
Experts say the stars are aligned for people to begin creeping back into the housing market.
The median price of a home in the United States dropped 15.4 percent in the past 12 months to $170,200, 30-year mortgage rates are below 5 percent and the government recently introduced an $8,000 federal tax credit for first-time homebuyers.
Bargain-hunting first-time homebuyers drove almost half of last month's sales, newly released statistics show. Buyers are "looking for something that they can get at rock-bottom prices," Faranda said.
And new homebuyers have plenty to choose from, according to data released today by the NAR.
The number of unsold homes on the market at the end of April rose almost 9 percent from a month earlier to nearly 4 million -- a 10-month supply at the current sales pace, experts say.
The homes that are selling fastest are small starter homes, especially those in foreclosure: Such homes have even sparked bidding wars in places like Las Vegas, Phoenix and Miami.
