The Little (Housing) Engine That Could By: Hale Chamblee
No small amount of attention has been paid to the flailing housing industry in an attempt to get it back on track as the engine that historically pulls us out of a recession, and by recent accounts, these measures are working. The drop in both interest rates and home prices, combined with the $8,000 tax credit for first-time homebuyers, have buoyed existing home sales. In fact, 2009 2nd quarter existing home sales are up 3.8% (in most states) from the 1st quarter and price reductions have made metro areas increasingly affordable.
A reduction in inventory will work to stabilize home prices, but in the meantime there are some pretty great deals to be had. While sales have slowed in Salida, Colorado and the surrounding areas, the market is far from dead. Recent weeks have shown a decided increase in activity as buyers that have been waiting for the market to “bottom out” before investing in the area are now taking action. The median home price in Salida, Colorado, this summer (based on sales from 5/1/2009 to time of writing) remains an affordable $250,000, while homes on an acre or more inch up only slightly to $270,000. Easily making Salida the most affordable mountain town in Colorado!
The need for goods and services associated with home sales inevitably pumps tens of thousands of additional dollars, per sale, into the economy – which may also account for the recent “I KNOW I can” attitude of the stock market. The steady rise of these economic indicators brings confidence that the upswing may well be sustainable – and while we still have a ways to go, this is good news for buyers and sellers alike!