What’s going on in the housing market?

A lot.

In the October home sales report released by the Illinois Association of REALTORS® today, there are many factors at work here−some working for, others working against a housing market recovery.

  • Foreclosures continue to exert downward pressure on prices and this will continue until the market clears of these troubled properties.
  • The tax credit effect lingers in the numbers. Last year at this time buyers were rushing to close to make the first-time buyer tax credit deadline of November 30, 2009 – before it was extended to April 30, 2010 and expanded to include long-time homeowners, too.
  • The economy is growing but much too slowly. It must make more significant and tangible strides before we’ll see consumers moving.
  • Jobs. More than ever the housing market is linked to jobs and the economy. We won’t see much improvement in consumer confidence or the housing market until things get better as a whole for the state and nation.
  • Credit remains tight. Lenders must make changes to the process so qualified buyers can close on a home sale.

And did I mention we are in the middle of the winter holiday season when weather and holiday shopping, travel and celebrations typically trump house shopping?

It’s really becoming wait-and-see mode. We need the economy to improve before we see realistic improvements in the housing market.

On the plus side…

There are a lot of good reasons to list now because motivated buyers are out there looking at the inventory. Yours could be the one they are waiting for.

  • Mortgage interest rates are still well below 5 percent offering attractive financing for buyers.
  • Affordability remains high with lower home prices and the low interest rates. If you are looking to buy, now could be your best opportunity before rates go higher.
  • There seems to be a tendency to wait for the spring market to list your home for sale. A good strategy could be to list during the holidays and stand out before it gets crowded with everyone else who is waiting for spring.

One thought on “What’s going on in the housing market?

  1. Things won’t get better as a whole until marginal tax rates are reduced and the government gets out of the way of business. Until then, get used to the new normal because this thing could go on for years, to wit Japan, and, oh yeah, our own experience with a recession that was exacerbated into a depression and prolonged by stifling government policies and not the failure of the free market.

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