Rise in national vacancy rate not worth panicking over
It has been reported that the national rate of vacancy, or the number of houses sitting empty, has reached a 13 percent, but don’t panic. That figure does not mean it is time to begin constructing a bomb shelter and making hats from tinfoil. The housing market is depressed, but signs of life are still there.
Wealthy buying fewer homes in vacation hot spots
The media report a number of economic indicators, and statistics regarding real estate can cause a sense of doom on the horizon regarding the housing market. For instance, CNN recently published an article that said up to 13 percent of homes sit empty in America. That is a misleading statistic; CNN points out that many of the vacancies are in areas like Maine, Arizona and Florida — popular places for vacation homes. Furthermore, vacancies have gone up less than 1 percent, from 12.1 percent to 13 percent, in four years.
Pending sales increasing
Pending sales, homes that are being officially in the process of being sold, increased by 2.1 percent over February, according to Bloomberg. The dip in home sales over the past few months was attributed partially to frigid winter conditions, as no one wants to go house hunting in the middle of a blizzard. However, pending sales for February 2011 were also 8.2 percent lower than for February 2010, as the housing market is still sputtering. Lawrence Yun, chief economist for the National Realtors’ Assocition, anticipates existing home sales will pick up over the rest of 2011, according to Reuters, as older homes are selling at a faster pace than newly built homes. Newly built homes are usually more expensive than older homes.
Reality of realty
Most news about the housing market makes it seem as though a second crash is imminent, and it may be. The reality is that sales are slow, houses are not worth as much as they used to be, and banks may be less willing to lend. Prices are likely to stay low as long as fewer people are willing or able to buy houses, and lenders are skittish about lending in the current economic climate surrounding real estate. The good news is that anyone with the means to buy right now will get a great deal, and people who already own are likely to see the value of their property rise in the next few years.