It’s hard to believe it has been 4 years since the beginning of this bumpy recession. The economy has really taken a hard hit, which was all started by reckless lending from financial institutions and mortgage-backed securities. Many investors took advantage of this to buy and resell homes, while others bought houses they really could not afford. When the rates grew higher, we saw a decline of the housing market that created issues for homeowners who had taken huge loans with very little money down. After the homeowners realized selling their houses for less than their mortgages would lose them money, the rise in foreclosures began to spring up all around the country.

We all know the rest of this story, which has obviously lead us to where this country currently sits economically. So, on the topic of housing markets, what seems to be in our future? Well, we can definitely see a decline in house prices, which analysts believe we’ll be seeing for a few years. While many of the foreclosed houses have already been sold, they estimate another 12 million properties will be put up for sale and with the annual sales of 4 million that takes us to about 3 more years of this decline. In the first quarter of this year home prices went down 5.1% from the previous year reaching levels we haven’t seen since 2002!

According to recent reports, many economists have confirmed a “double-dip” in home prices across the country. Prices are down 32.7% from their peak 5 years ago. This decline in the housing market is causing much less construction on new homes to begin or even complete, as they cannot compete with the low prices of already existing homes. Normally the construction of new homes aids to economic recovery, but not this time. The number of new homes that have been sold is slightly above the lowest level in the early 1960’s! Seems as though the housing market forecast is not looking good too good for the future, but we must not give up our hopes. It’s sometimes hard to remain positive about something completely out of our control, but despite all of the economic turbulence, this country is still a favorite among billions of people, including myself.

This entry was posted on Monday, July 4th, 2011 at 10:43 am and is filed under Personal. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.