The Real Estate Market in 2011 – Trends to Follow
2010 held much uncertainty in the world of real estate, and 2011 promises more of the same. Various housing markets are showing signs of improvement, while others–well, not so much. It’s good to remember that all the facts and figures brandished so freely are very generalized. We might as well try to predict tomorrow’s weather by averaging the national temperatures. (OK, that might actually work in some places, but you get the idea.)
2011 California Housing Market Forecast
Since I know that you secretly do want some facts and figures, the California Association of Realtors has published the “2011 California Housing Market Forecast.” Notable observations: Investors are driving the recovery. In 2010, 18.7% of home purchases were by investors, up sharply from 2009 and 2008 levels. While the only way we know we’ve “hit bottom” is several months later when we see prices going up, if the investors are willing to spend some money, that has to be considered a good sign.
Traditional Sale vs Distressed
Also noted, distressed properties accounted for a smaller share of the market. A year ago, only 54% of home sales surveyed were traditional, non-distressed sales. In 2010, 59% of homes sold were non-distressed situations.
What will surely come as a surprise to many is nearly half of properties sold attracted multiple offers. Home sellers received an average of four to five offers during the past two years, slightly higher than the number received at the peak of the boom market! Please see the excerpt for four charts and more detail.
What to Expect
We’ll have to see what opportunities arrive in 2011, but whether you are a potential buyer or seller, there definitely are some good options to consider. Even if home values fall in the future, increased interest rates could mean that home purchase will cost more each month–as well as in the long run. Before you make any real estate decisions, consult with a knowledgeable real estate professional, and you’ll find all the information you need to make the right choice for your 2011.