There are Signs of Hope, but the Market Isn’t Fully Recovered

Recent research by Arizona State University shows that existing home sales in the Queen Creek area are leveling off, but the rate of foreclosures is beginning to drop. This news shows that the economical face of real estate is starting to look a bit different from what we saw a year ago.

In the Queen Creek area, resale home sales are up significantly this summer from the summer of 2008, and while foreclosures still account for about one third of sales, last year they accounted for about one half of sales.

What experts at ASU are saying is that at this point the market is being driven, at least in large part, by investors who are anxious to make a home purchase at a great price with the expectation of hefty appreciation.

While the current home buying situation may be working well for investors and new owner-occupants (especially in light of the government tax credit for first-time home buyers), and there are signs of recovery in the real estate market that we can all appreciate, real recovery won’t take place until foreclosures drop to much lower rates (3 – 5 percent), prices rise, and home owners vs. investors are the ones who are the driving force in the real estate market. At this time, with tight home financing, and a weak economy and job market, it’s likely that full recovery is still a way’s off.