The US housing market is recovering from its worst slump since the Great Depression of the 1930s. Consultancy, Herrmann Forecasting, says "We're seeing multiple signs of a bottom in the housing market”.
Here's the evidence: Prices rose 1.4 per cent in the second quarter 2009, the first rise since they started falling three years ago. The number of new homes being built is rising, sales of existing homes is rising and the value of house-builders' shares is rising.
Why the upturn? The 32 per cent fall in prices from 2006 to the first quarter of 2009 is finally bringing buyers back into the market.
Some clouds remain on the horizon: unemployment is growing and a massive USD3.4 trillion worth of homes remain at risk of repossession, because their owner's mortgage debt exceeds the value of the property.
What's more, masses of new homes remain empty and a third of existing homes sold are repossessions. This prompts Capital Economics to caution “the housing market has turned the corner, but the recovery will be slow and long.”
(All The World's a Home : Global Property News)
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