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Housing Data

The latest housing data came out on the positive side today. That’s good news for real estate and the economy as a whole. Since the housing and banking industry seem to be shouldering the blame for this downturn, any improvement is seen as a good sign.

New building permits came in at .52 Million which is slightly better than the .50M that was forecast. Last months figures were .50M, same as the current forecast.

Housing starts were also up by a nice margin. There were .53M new starts last month, up from .45M in May and .5M higher than the .48M forecast.

This is good news for the economy as it means people are buying homes. Simple supply and demand, homes are being bought and new ones are needed. Now whether this is due to the incredible Government assistance or not is irrelevant, either way it props up the industry while we struggle for a full recovery.

For real estate it’s obviously good news. For potential buyers it could mean rising home prices. Over supply equals lower prices as builders and sellers try and unload inventory. Not enough supply means higher demand as builders and sellers run low on inventory and can create competition among buyers.

The industry as a whole benefits from higher demand. Buyers who are not able to buy now due to job loss, decreased salary or whatever financial reason still benefit as the economic recovery is spurred and more jobs are created.

Those buyers riding the see saw of interest rate and price fluctuations run the risk of being on the wrong side of the fence when the breakout occurs.


June 16, 2009 - Posted by | Uncategorized

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