Ed's Blog

This week the National Association of REALTORS® (NAR) issued a report which indicated that median home prices are down nationally 9% from the same time last year. While that doesn’t sound like particularly good news for homeowners; in California, it may be an indicator that we’re nearing the end of price declines, as buyers are re-entering the home purchasing market.

Let me explain. Because home sales are rising so rapidly in the hardest hit areas of California, and because in many cases homes for sale in California are beginning to see multiple bidders for properties, NAR’s Chief Economist Lawrence Yun stated that this “suggests that future price declines may be minimal.” Hot diggity! Hope he’s right.

Although the financial crisis has now spread far beyond the housing bubble, there’s little doubt that the economy can’t make a full recovery until the surplus of inventory (homes currently for sale) levels off. So, although I’m not thrilled that most homes have lost value, I see the increasing number of home sales as a step in the right direction toward recovery.

As always, please feel free to email me at ecraine@smithcraine.com or call me directly at 415-406-2330 if you have any questions, on this or any other real estate or mortgage related questions.