Are you currently considering a US real estate purchase but concerned about the state and overall health of the market? If you’ve attended any of my 3 Day Quests or if you watch my Twitter and Facebook, you know that I think it’s an ideal time to move forward with a US real estate purchase. Now is the time to snap up investment properties; prices are low and financing is available (I just closed a deal on a multi-unit building in Florida last week). However, it’s still important to have a picture of what’s happening with US real estate prices and keep an eye towards the future to anticipate coming trends.
Making a US Real Estate Purchase in 2012: What’s Happening Now
Housing prices are still dropping. Previously predicted to depreciate by .2%, that number’s been bumped up to .7%. Why the shift, and what does it mean in terms of planning for a US real estate purchase? First, the 2011 Case-Schiller home price review was not quite as sunny as we had expected. Second, an expected increase in foreclosures is predicted to bring down housing prices in a number of markets, which has the potential to make a US real estate purchase even more accessible.
Making a US Real Estate Purchase in 2012: What’s Happening Next
It’s looking like housing pricing will bottom out in 2012 for some markets and in early 2013 nationally. Those looking to make a US real estate purchase should consider that while prices are slated to depreciate for the remainder of 2012, 2013 is expected to bring a modest appreciation. It won’t be a massive recovery by any means, but will kick off the beginning of a 2-4 year recovery period. High negative equity rates will continue to result in foreclosures which will slow down price appreciation significantly, but the housing market should be somewhat normalized by 2016 at which point houses will once again be considered a non-depreciating asset. All things to keep in mind when moving forward with a US real estate purchase.
Making a US Real Estate Purchase in 2012: What to Keep an Eye On
Unemployment is absolutely the statistic to watch. Coupled with negative equity, this is one of the single strongest factors in influencing the real estate market.
Finally, keep in mind that even as interest rates climb, foreclosures have been keeping prices lower, so there’s a still a huge degree of affordability when it comes to a US real estate purchase. The pricing as it is now is largely a result of a crisis of confidence.
What are your thoughts on the market? Check out my US real estate workshops to learn how to make a successful US real estate purchase as a Canadian.