Market Trends and Condition

While 2011 will be another challenging year for the housing market, many real estate experts are hopeful about the future and taking action toward recovery. A market comeback is contingent on a solution to the foreclosure issue, which is suppressing home prices and consumer confidence. For that reason, real estate professionals need to educate themselves about buying and selling distressed properties, handling short sales and working with investors, says Margaret Kelly, chief executive officer of RE/MAX and a panelist at the State of the Real Estate Industry forum held during the 2010 Realtors Conference and Expo.

Over the past few months, quietly, the banks have turned on the lending spigot. Growth is still modest and is weighted toward the strongest corporate and consumer borrowers. However, after several quarters of flat or lower loan balances, several of the nation’s biggest banks are reporting increases.

On Monday, Citigroup officials reported that the bank recorded loan growth compared with a year ago. This growth was in all of its businesses during the third quarter and in their businesses around the world. Wells Fargo announced new loan commitments to small businesses were up 8 percent, while lending to larger companies has been growing for 14 months in a row.

We all know this but the big boys are getting ready to jump in with both feet. If this happens, prices will stabilize and probably jump up. Of course, it is still a little early in their game plan so get yours before they do.

Read the whole story here:

http://www.cnbc.com/id/45063559

http://money.cnn.com/2011/10/21/real_estate/buying_us_homes/index.htm

Pending sales of existing U.S. homes dropped for a third successive month during September, a real estate industry group reported on Thursday, though a sales index was above year-ago levels.

Sales of new U.S. homes rose in September after four straight monthly declines, largely because builders cut their prices.

The Commerce Department says sales rose 5.7 percent last month to a seasonally adjusted annual rate of 313,000 homes. Still, that's less than half the 700,000 economists say must be sold to sustain a healthy housing market.

The median sales price of a new home fell 3.1 percent to $204,400 — the lowest since October 2010. The number of new homes on the market was unchanged at 163,000, a record low.

Sales of new homes fell for four straight months before September and hit a six-month low in August. This year could be the worst year for sales since the government began keeping records a half century ago.

This story is from here:

A big increase in multi-family unit groundbreaking was the impetus for a surge in housing starts in September that was at the fastest pace in 17 months. The Commerce Department said that housing starts increased 15.0% to a seasonally-adjusted annual rate of 658,000 units. Analysts had only estimated a 590,000 unit rate.

Housing starts for buildings with two or more units rose 51.3% to a 233,000 unit rate. Single family home construction, which accounts for a larger share of the market, increased 1.7% to a 425,000 unit pace. On the inflation front, another report showed that consumers paid more for food and gas last month.

It takes consumer confidence for real buyer/homeowners to enter the market. This market is not making it easy. There is money to be made but you have to be smart about what you are doing.

Read the whole story here:

http://bottomline.msnbc.msn.com/_news/2011/10/25/8479585-consumer-confid...

Analysts are predicting that REO, Real Estate Owned, bank owned properties will not peak until sometime in 2013. Nearly half of the more than 552,000 REO properties liquidated in the first half of 2011 were held by private banks. In the coming years, the government will be the primary holder liquidating their inventory. This includes properties owned by HUD, Freddie Mac and Fannie Mae.

Estimates now are that the inventory could reach 1.48 million properties in 2013. Bank of America Merrill Lynch analysts estimate a 10% increase in the projected amount in 2012. Though these analysts don’t expect as much downward pressure on prices as we’ve experienced in the last few years, there will be further softening of prices into 2013.

The annual rate of change in home prices continues to show improvement, according to Standard & Poor’s. Data just released by the agency shows the 20-city composite reading of the S&P/Case-Shiller index for August came in below its year-ago level by 3.8 percent. The previous month, S&P reported a 4.1 percent annual decline. The closely watched gauge posted a 0.2 percent increase in August versus July, marking the fifth consecutive monthly gain.

Analysis: On this front, the price of the housing decline is slowing. The two other legs of the stool, foreclosures and financing, are still not in positve territory and may not be for a while. Just be smart with your investing and have a quick exit plan for your purchases.