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Is The Housing Market Rebounding?
Posted By Eric Mally On August 27, 2012 @ 2:51 pm In Home Buying,Home Sales | No Comments
Just with any sort of market analysis, you’re going to get the folks who think that everything is fine and dandy, and you’re going to find writers who feel that everything is in a pre-apocalyptic state.
In fact, you can argue both sides of the coin here. Think of it as the debate between who was the better running back in the prime of their careers: Barry Sanders or Walter Payton?
Everyone knows there’s a correct answer to it, but no one knows what it is (it’s Barry, hands down in my humble opinion).
Think about this for a second – we’ve had near record low mortgage rates for the better part of the year, people want to refinance left and right, and the number of existing homes sold rose 2.3% in July from the previous month.
Additionally, homebuilders have been seeing profits when the past few years haven’t been the kindest to them. Toll Brothers, one of the primo names in the construction industry, saw an increase of home sales by nearly 40% in a year, and its stock has jumped a solid 122% in a 12-month span, too. That’s not too bad for a company that produced 2,642 homes in 2010 when they had projected 15,000 during the boom of 2005.
Clearly, all signs would point to a rebound, right?
Maybe. You have to remember that there is a weak job market, wages that don’t change, and tighter lending standards that can hinder home purchases. The unemployment rate has remained around the same 8.1%-8.3% line for some time now, and it’s hard to imagine that too many citizens without jobs will be buying homes anytime soon.
Like any market, though, you’ll see your peaks and troughs. The Dow Jones Industrial Average has seen point swings of more than 500 points within the past month alone – it’s just the natural way of the market.
This seems to be the general consensus amongst real estate agents, as well. Barbara Gargiulo, a real estate broker in northern New Jersey, said “I think we’ll have some small little peaks, small little valleys, but in general we’ll see an upward curve over the next few years.”
An upward curve is nice, but what classifies a major improvement? At what point do we start becoming frustrated with small victories when the big ones elude us?
Regardless, slightly optimistic news and market analyses are better than pessimistic news and negative analyses, right?
As my main man Eric Idle once said, “Always look on the bright side of life. Do-do, di-do di-do di-doooo.”
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