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Where is this market headed?


May 13, 2013
I used to get asked, "How's the market?" Now, it's more of a statement: "I hear the market is great."

Most people are happy to hear that new construction is back and homes seem to be selling well.

But some think this improvement will be short-lived.

CoreLogic stated prices rose 10.5 percent nationally in March from a year earlier. The National Association of Realtors reported the median sales price was up 12 percent and the S&P/Case-Shiller Index has prices up 9.3 percent in February.

All positive signs that have homeowners saying "Finally!"

However, one view is that price gains are fueled by high investor demand and competition for low inventory, which can't be sustained, so we'll see prices drop again.

A broad segment of the market still underwater all affect this as well.

I think that view is true, but doesn't reflect the whole picture. Buyer demand is a result of greater consumer confidence in the housing market. That confidence, resulting in more robust home sales, will drive further economic improvement.

New home construction has increased employment, which will drive truck and auto sales. Retailers will see the benefit of the average $7,400 spent by owners of newly built homes as they purchase furnishings, appliances and other goods.

This housing recovery might not be due to any broader economic improvements, but maybe now it will be the driver of broader improvement in the economy.

drop again.

A broad segment of the market still underwater all affect this as well.

I think that view is true, but doesn't reflect the whole picture. Buyer demand is a result of greater consumer confidence in the housing market. That confidence, resulting in more robust home sales, will drive further economic improvement.

New home construction has increased employment, which will drive truck and auto sales. Retailers will see the benefit of the average $7,400 spent by owners of newly built homes as they purchase furnishings, appliances and other goods.

This housing recovery might not be due to any broader economic improvements, but maybe now it will be the driver of broader improvement in the economy.

Bob Strader is a local realtor with the NORTH Group of Keller Williams Realty. Visit his blogs liveincumming.com or liveinalpharetta.com or email him: info@thenorthgroup.com.
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