Has Housing Stabilized?

Single-family homes sales data for Santa Cruz County as of February 2010
Median price: $500,000 ($380,000 a year ago, $682,500 in 2008)
Listings on the market: 844 (1,049 last year)
Number of Sales: 93 (compared to 92)
Unsold Inventory: 4.7 months (down from 11.4 months of inventory a year ago)
Average price: $542,739 ($490,238 a year ago)

The California Association of Realtors (C.A.R.) notes that the median price of an existing home rose 8.4% compared with a year ago, to $306,820. This is the second year-over-year increase. Zooming out, still excluding new home sales, the western region including California showed sales increased about 7% over a year ago. And on a national level, the National Association of Realtors notes that the S&P/Case-Shiller U.S. National Home Price Index Sales were 11.5 percent higher than a year ago.

Nationally, median existing home prices are stable year to year at $164,700. According to the Federal Housing Finance Agency, prices fell by only 0.1% nationally from the previous quarter. IHS Global insight released a press release today indicating that "For the country as a whole, the housing market is now slightly undervalued. When weighted by market value, the nation is 8.9 percent undervalued."

Experts point out that California's inventory may be low due to several factors. Some homeowners and corporate owners alike appear to be waiting for prices to increase before they sell. Owners of foreclosed properties are taking a measured approach, listing their properties over time. Some people are concerned there are more foreclosures to come, as unemployment continues to rise. However, C.A.R. predicts that foreclosures will remain flat in 2010.

It appears that sales of existing, single-family homes bottomed out in August 2007, while the median home price bottomed in February 2009.

Reuters recently reported that new "housing starts rebounded more strongly than expected to their highest level in six months in January, while permits fell slightly less than forecast, pointing a mild housing market recovery. Housing, which is at the core of the most painful economic downturn since the Great Depression, is crawling out of a three-year slump, supported by government programs. New home construction contributed to economic growth in the third quarter of 2009 for the first time since 2005."

Read more:
http://www.santacruzsentinel.com/ci_14699561?source=most_viewed
(www.ihsglobalinsight.com),
(www.reuters.com)