If you bought a house in the last five years and you’re reading about too many disappointing news regarding the real estate industry in the US, you’re probably wondering how much your house is worth today. You’re also wondering if the situation will get any better soon.
According to CNN and other observers, the situation is not going to get any better for the next 12 months or so.
Money Magazine took forecasts from two sources – Fiserv Lending Solutions and the S&P Case/Shiller Home Price Index – and both these sources point to decreasing prices of homes; that decreasing trend will continue. Fiserv says that prices will continue to fall through the end of 2009 in 75 out of the top 100 US cities, while the S&P Index, which tracked house prices in 20 major housing markets, revealed that as of February this year, the value of homes in those markets fell by 12.7%.
More bad news: The number of foreclosures more than doubled for the first three months in 2008 registering a 112% increase. Close to 157,000 families have had their homes repossessed. The saddest thing to all these? Gloomy periods for real estate will continue till the end of 2009 and through a part of 2010.
Has anyone been spared? Chances are if you live in Texas, you may have been spared from the price erosion, but residents of certain parts of California – Stockton as an example – are already experiencing tumbling prices.
Some markets holding steady or rising
Money Magazine conducted a survey of ten areas where prices are holding steady or are bucking the trend.
If you live in McAllen, Texas, for example, you’re one of the few lucky ones. If you bought your house last year, the value of your house would have increased by 2.1%; if you bought your house five years ago, you would have gained about 23% in the price of your home. This is for a house costing $105,000 so it isn’t clear whether those increases would apply to homes in an upper price range.
Rochester, New York is another fast-growing area where an averaged-price home ($121,000.00) bought a year ago increased by 3.4% and bought five years ago would now have increased by 20.1%.
Other areas that don’t appear to be affected by the real estate slump are: Birmingham, Syracuse, Niagara Falls, New Orleans and Scranton.
