U.S. home prices are finally in “the early stages of recovery,” according to a new report by TD Economics. In April, the average U.S. house price rose to $177,400, up 10.1 per cent from a year earlier, the biggest uptick in prices since 2005.
While Florida was among the Top 10 U.S. states for price gains in the first quarter of this year, its housing recovery remains fragile because the court system is “drowning in a flood of foreclosures” that could overwhelm the market and drive prices down again, it cautions.
The recovery in the US finally appears to be self-sustaining, although economic growth should be moderate this year. Job growth has spread from the tech-related markets and has become broad-based across many industry segments. Combined with historically low supply, that will produce a moderate improvement in commercial real estate fundamentals in upcoming quarters.
Homebuilder confidence in the U.S. has seen a modest improvement in the month of June, according to a report released by the National Association of Home Builders on Monday, although the increase came after a downward revision to the reading for May.
"In addition, builders across the country continue to report that overly tight lending conditions and inaccurate appraisals are major obstacles to completing sales at this time," he added.
The modest increase by the headline index was largely due to an improvement by the component measuring current sales conditions, which rose to 32 in June from 30 in May.
The housing market has continued to show signs of improvement as U.S. home prices in March edged higher for the second month in a row. On a seasonally adjusted basis the S&P Shiller composite index of 20 metropolitan areas gained 0.1 percent in March, just shy of economists' forecasts of 0.2 percent. There were price increases in seven of the twenty cities covered.
Despite a rocky U.S. housing market shares of high yielding REITs have performed well in 2012, as they continue to take advantage of record low mortgage rates. The Vanguard REIT ETF -- which tracks the performance of an index that measures the performance of publicly traded equity REITs -- is up nearly 10 percent this year, outperforming the Dow Jones Industrial. Five Star Equities examines the outlook for diversified REITs and provides equity research on American Capital Agency Corp. (AGNC) and CYS Investments Inc. (CYS).
Housing indicators for the first quarter of 2011 continue to portray a fragile recovery in the housing market. In
the production sector, the number of single-family housing starts, permits, and completions all declined.
Privately owned Housing starts fell in May 2012: the seasonally adjusted annual rate settled at 708,000 compared with the revised up rate of 744,000 in April 2012 – this change represents a 4.8% drop; alternatively, the annual rate for May 2012 was still 28.5% above the May 2011 rate of 551,000.
On the other hand, the seasonally adjusted annual rate of building permits for privately owned housing reached in May 2012 780,000 – a 7.9% increase compared with April’s annual rate of 723,000. The May 2012 rate was also 25% above the rate in May 2011.
Yes, some. Buying a house is looking more and more attractive relative to renting. With low interest rates and lower prices, the cost of purchasing a house is lower than it has been over most of the last ten years. Ken Johnson, a professor who studies real estate, and the buy-vs.-rent problem in particular, concludes that buying looks like a better bet than renting.