As we kick-off the new year and make resolutions to keep our resolutions, one question is still at the forefront. Will the housing market and the economy improve over all in 2011?
Depending on what you’re reading or who you’re watching, the opinions of economists and real estate industry watchers are varied. It’s not easy to predict what the market will do in the coming year, especially without the help of a crystal ball. However there are some key indicators to follow.
Most agree that the housing market recovery is largely based on the recovery of the job market. Consumers will make a down payment and purchase a home when they feel financially stable and secure.
According to a U.S. Bureau of Labor Statistics report released in December, 28 states and the District of Columbia posted unemployment rate decreases from a year earlier although the national jobless rate approached 9.8 percent in November.
In December, the Labor Department issued statistics that showed applications for jobless insurance payments fell by 3,000, sending the average in December to the lowest level since August 2008, and fewer workers filed claims for unemployment – signaling that the U.S. job market is improving, if only slightly.
Another indicator to watch is pending home sale statistics. According to the National Association of REALTORS® (NAR), pending home sales jumped in October, showing a positive uptrend since bottoming in June. The NAR Pending Home Sales Index rose 10.4 percent to 89.3 based on contracts signed in October from 80.9 in September as buyers rushed to meet the Tax Credit deadline in 2009. On the downside, the index remains 20.5 percent below when compared to the same time last year.
Overall, these numbers are positive, but we still have some way to go before a full recovery is realized.
“It is welcoming to see a solid double-digit percentage gain, but activity needs to improve further to reach healthy, sustainable levels,” said Lawrence Yun, NAR chief economist. “The housing market clearly is in a recovery phase and will be uneven at times, but the improving job market and consequential boost to household formation will help the recovery process going into 2011.”
At Coldwell Banker Residential Brokerage, we are looking forward to at 2011 that brings a revived economy and a stable housing market. Let me help you be part of that improving market.
For a free, confidential comparative housing analysis for your neighborhood, call me at 703.227.4554.