Harvard report finds housing market showing signs of revival

The housing market is gaining strength and 2012 could mark the beginning of a true market recovery, according to a new report, The State of the Nation’s Housing 2012, released today by the Joint Center for Housing Studies of Harvard University.

“While still in the early innings of a housing recovery, rental markets have turned the corner, home sales are strengthening and a floor is beginning to form under home prices,” said Eric S. Belsky, managing director of the Joint Center for Housing Studies in a news release.

“With new home inventories at record lows, unless the broader economy goes into a tailspin, stronger sales should further stabilize prices and pave the way for a pickup in single-family housing construction over the course of 2012.”

A rebounding rental market, an increase in new and existing home sales and moderate gains in multifamily construction are all factors that point to a turnaround in the market, according to the report. But the housing market also faces ongoing challenges including a backlog of foreclosures, fewer household formations and slow job growth.

Some highlights of the report:

  • By the first quarter of 2012, existing home sales (single family and condos) were 5.2 percent above year-earlier levels, with single family sales up 6.3 percent.
  • After hitting a record low of just 306,000 in 2011, sales of newly constructed homes in the first quarter of 2012 stood 16.7 percent above year-earlier levels.
  • The inventory of existing homes for sale shrank by some 23 percent in 2011, reducing the supply in the first quarter of 2012 to its lowest level since 2006.
  • The monthly mortgage payment for the typical home currently compares more favorably to rents than at any time since the early 1970s.
  • Renter growth hit 1.0 million in 2010-2011, the largest annual increase since the early 1980s.
  • According to MPF Research, nominal rents on investment-grade multifamily properties rose 4.7 percent from the fourth quarter of 2010 to the fourth quarter of 2011—double the 2.3 percent increase a year earlier.

Download the full report, a video Q &A, fact sheet and more from www.jchs.harvard.edu.

2 thoughts on “Harvard report finds housing market showing signs of revival

  1. This report reflects the current market in Central Illinois and gives credence to the numbers we have been reporting and the condition of our local market. It’ good to see a national report that isn’t all gloomy d doom.

  2. Pingback: Real Estate Market Poised for Recovery According to Harvard Study | Tammy Mitchell Hines, Tammy Mitchell Hines & Co.

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