Friday 13 July 2012

Return Of The Housing Market

Posted by at 2:24 PM

Banks throughout the US have begun lending more, which means more buying and rising prices in the housing market. In addition, the effect of diminishing inventory of homes will result in increased construction, leading to employment growth all which will boost demand for new houses. In layman’s terms, this means we are beginning to see a return of the Housing Bubble.

According to “The Economist”, there is too little housing in America and homes are currently greatly undervalued comparative to income and rent. This shift in dynamics is what we’ve been waiting for and will result in a healthy growth in the housing market.

Evidence of this shift can also be seen in the increase of competitive bidding. Although the current environment is not ideal, prices are beginning to increase. Could the six-year-long-slump be over? Many are finally beginning to think so.