Very exciting news for home buyers, especially those purchasing new Bayside homes in Fenwick Island and Sussex County. According to the S&P/Case-Shiller Index, prices rose in the largest 20 markets by more than 8% this past January (compared to 2012), with new home sales up 12% in comparison to last year.
This is the fastest recovery rate seen since before the crash, which started showing positive change in the last three months of 2012 when housing prices rose at an annual rate of 7.3% and the sales of new homes rising even higher.
As noted by Chris Isidore from CNNMoney, this is the third straight quarter of year-over-year gains where home prices have increased. “The improvement in the market is driven by many factors, including near record-low mortgage rates, a drop in the number of home foreclosures, the tight supply of both new and previously owned homes available for sale, and an improvement in the overall economy, including a lower unemployment rate. These factors are combing to bring potential buyers who have been scared to buy during the housing downturn back into the market,” said Isidore.
This increase in home prices is the largest annual increase since the second quarter of 2006. Cooper Howes, an economist for Barclays, points out that whether or not sales growth slows, there are still no signs of a new housing bubble. Barclays predicts a 6 to 7% gain this year, with 2014 showing gains of 5 to 6%.
“All the signs are positive. Again, there are some clouds on the horizon . . . but generally speaking, we seem to be in the midst of recovery. I just don’t think it’s an overly robust recover, but I think there are clear signs of recovery,” said Nicolas Retsinas, Senior Lecturer in Real Estate at the Harvard Business School.
Source: CNNMoney, PBS Newshour