In the third quarter of 2011, nationwide statistics from the real estate market have revealed numerous indicators that multiple markets may hit a resurgence in the early months of 2012. Home building projects have increased, as well as mortgage applications with rates lowering.
States across middle America have proved to be retaining the strongest numbers as areas such as Texas and Oklahoma cities have continued to stay afloat with job creation. Not all markets are hitting a full rebound; instead they are achieving small improvements in different categories that have an influence over the total market.
One reason that prospective buyers may get off the fence and help the real estate market is the continuous rise of rental rates throughout the nation. For example, San Antonio apartment rents have continued to climb, even in a relatively strong housing market (ranked no. 10 by Forbes). In many areas, dramatic increases were expected and fulfilled throughout the year. As these rates continue to rise, potential homeowners may see another reason for buying.
With rental rates going up, mortgage rates also play a large role in the thought that those looking for a new home could choose to go the route of purchasing. For most of the nation, the second half of the year has spelled record low mortgage rates, sometimes dipping into the sub four percent range. Right now they are hovering just above four percent in many cities for a 30 year, fixed rate. These low rates have come about at just the right time, as rental rates continue to go up.
With respect to the good statistics coming out in the third quarter, there is no true way of knowing whether the current “strong” markets will ever gain the jumps that have occurred in the past decade. Just as it has in the past few years, the real estate market will likely go along with the tides of job growth and economic forecasts.
Some have said not to expect a full recovery for a few years, while others have been more optimistic. In the end, it’s truly relative to the characteristics of each location. In many areas, home prices and sales have felt the brunt within the first two quarters, through the summer months. While the winter is often a down period for the real estate markets, the numbers from August and September in some areas were rather promising.
In some markets, expect minor gains while others can hope for more steady gains into the future. High appreciation may be a long ways off, however small and steady gains could take place in the early months of 2012.
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