Friday, August 28, 2009

The New York Times Reports "Housing Perks Up"

According to an article in The New York Times, housing prices in nearly all of the major markets in the country rose in June. Home prices in San Fransisco rose 3.8% while home prices in Boston increased 2.6%.
In the Midwest, Cleveland saw an increase of 4.2% during June. How did Bloomington fare compared to the national market?
Keeping in mind that Bloomington has not seen prices decrease during this troubled time in the national market, Bloomington is doing well. The average home price decreased from May to June by 1.4%. But the number of home sales increased by a whopping 12.3%!
The increase in the number of sales and the decrease of the average sales price is directly related to the $8000 First-time-home-buyers tax incentive. More people are buying their first home and because these are first time home buyers, the average sales price will typically be less than for people who are buying their second or third home.
Another thing to keep in mind is that on the national market, home prices were showing great declines in home prices because of the vast number of foreclosures that were hitting the market. Though there are certainly foreclosures available for purchase in Bloomington, they account for only a small percentage of sales.
The verdict: the national housing market seems to have hit bottom and is bouncing back and Bloomington continues to have a healthy housing market. However, as home prices increase nationally, we will see an increase in home prices here in town, so the best deals are most likely happening right now.