Quicker Recovery for New Homes Expected in 2011

In a community full of new homes, does this mean things are looking up for South County? Lets just say we are very optimistic.

In its latest real estate and economic forecast, the National Association of Realtors anticipates that sales of existing homes, after falling 4.8 percent in 2010, will rise 7.9 percent this year, to 5.3 million, and another 4.5 percent in 2012, to 5.53 million.

The median price of existing homes, meanwhile, rose 0.3 percent in 2010 after a 12.9 percent drop in 2009, and is expected to rise 0.5 percent this year, to $173,800, and another 2.4 percent in 2012, to $177,900.

Sales of new single-family homes are expected to rebound faster, rising 17.7 percent this year, to 374,000 sales, after a 15.5 percent drop in 2010, and then rising 51.1 percent in 2012, to 565,000 sales. In an earlier forecast, released last month, NAR anticipated that sales of new single-family homes would climb 20.8 percent in 2011 and 30.9 percent in 2012.

The new-home median price rose 2.2 percent in 2010 and is expected to climb 1.8 percent this year, to $224,700, and 1.9 percent in 2012, to $229,000.

NAR expects that 30-year-fixed mortgage rates will average 5.1 percent this year, up from 4.7 percent in 2010, and rise to 5.9 percent in 2012.

The group also forecasts the U.S. unemployment rate to fall from 9.7 percent in 2010 to 9.4 percent this year and 8.7 percent in 2012, while U.S. real gross domestic product is expected to dip from 2.8 percent in 2010 to 2.6 percent this year, rising to 3.2 percent in 2012.

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Market Conditions for South County - Chula Vista Real Estate

Market conditions as we enter into February seem to be warming up a bit for our fortuitous buyers. This is really their market. Inventory is high, prices are at an all time low, and interest rates are historically low. For inventory under $400K we are even seeing multiple offers again (especially on our Short Sale and Bank owned properties).

The upper end market is still softening a bit. There are many factors that hamper the market in those areas. Stiffer mortgage restrictions on jumbo loans, state of the economy, and when the bulk of your move up market has lost their equity and/or their home to Short Sale or Foreclosure, the buyer pool is greatly diminished. We do, however, expect to see a healthy recovery in this market, it will just take more time.

Positive indicators is that activity is picking up in our area dramatically. Buyers are out there. First time homebuyers are increasing and will be a major contributor to our market in 2011. The South County can still boast fantastic amenities, outstanding schools, and great growth opportunities. That coupled with the inventory of fantastic homes and affordable prices, this is the destination of choice for many families, individuals and couples to settle down and call home.

Visit www.mcmillinrealty.com to find a home that suits your needs today. Anyone of their outstanding agents can help you!

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