Posted: 27 Jan 2014 08:28 AM PST
Housing sales dropped 7 percent nationwide as demand for homes declined significantly. That is the bad news, but there is good news.
Housing prices did rise 4.6 percent compared to December, 2012.
So what happened. The reduction in foreclosure inventory and overall inventory has created a bit more scarcity in the marketplace. Odds are the low hanging fruit that the investment real estate community has been buying up has diminished enough to show up in the housing sales statistics.
For homeowners this is actually good news. If the housing market is strong enough that investors are having to pay a premium it means that homeowners will be in a stronger position when it comes time to sell.
Of course, the real estate industry is full of world class spinners when it comes to interpreting the good or bad news that it is always time to buy, so it may make sense to watch the market and see if the downward sales trend will continue or if this is truly a function of a shrinking inventory.
The economic pressures of higher health insurance costs, tax increases, unemployment, and inflationary pressures on the housing market need to be watched going forward.
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