Ice Cream And The Housing Market – A triple dip may be a good idea at Baskin-Robbins, but it’s a lousy one for Housing Prices.
That’s exactly what the housing market could experience by spring 2012 – if the economy falls back into recession, according to real estate monitoring firm Clear Capital, which just released its monthly Home Data Index. The immediate takeaway is a positive one – Clear Capital says that U.S. home prices, on average, have risen 3.5% across the board in the past three months (from July to September). But the longer-term view isn’t as pretty. The index says that there is a “strong potential for a triple dip” decline in U.S. home prices in early 2012, but only if the economy “falls back into its second recessionary period since 2006″.
They won’t venture to guess exactly if we’re headed into recession — after all, there’s really no telling how the economy will look in the next six months. But using current economic data, the firm does say that if the economy continues on its current trajectory, U.S. home prices would fall by 3.2% in the next six (6) months.
If there is any good news under that scenario, they say the projected decline is significantly better than the 7.7% decline the U.S. housing market experienced from September 2010 to April 2011. The firm says that the first dip in housing prices took place in the winter of 2009, and the second one in the winter of 2011. The dreaded triple dip would likely follow that cold weather path, and hit the country by winter 2012.
The September home price measures show continued slowing of the price gains we’ve seen this year, especially across the spring and summer months. Costal North County and parts of Downtown San Diego fared better than most but still not were a lot of homeowners would like to be.
What’s really dragging on home prices are jobs and the greater than 9.0% unemployment figures.
The normally positive market forces of record low mortgage rates and near record lows in home prices are being offset by high unemployment rates and general consumer pessimism about the economic future. Until we start to see some stability within the markets, housing prices and going to remain depressed. Regionally here in southern California we are still dealing with sellers that have an unrealistic valuation as to what their home is truly worth. The reality is that he numbers don’t lie. If your neighbor’s home that’s a model match just sold for $500,000.00 a week ago, there’s no way that a starting price should be $775,000.00 on your home – that’s ridiculous.
Homeowners that are considering selling their home through Short Sale really need to focus on the market relevance when pricing their home for sale. Your realtor should provide comparable sales figures that snap shot a 90 and 120 day time period – that’s it. Looking at what a home sold for a year ago is great, but it’s not going to help you sell your home today. The key to staying ahead in today’s market is staying informed. When you call Moser Realty Group we will provide that necessary data to get you up to speed and ready to face the potential challenges of selling your home. Call or email my office today to get a free valuation report to see what your home is worth. The only triple dip you should be thinking about is when you’re in line at Baskin Robbins . . . .