U.S. housing market finally ready for take-off?

January 08, 2013

CBS News Moneywatch

Last year ended on an up note for the real estate market: Home prices, pending sales and construction activity all increased, while the number of existing houses for sale continued to drop. At the same time, home values remain depressed, while what is expected to be slow economic growth this year could hinder the housing sector’s recovery.

So will 2013 be the year that buyers and sellers finally return to the market en masse, or will people continue to stay on the sidelines in hope of a stronger recovery?

Many, but not all, experts believe will 2013 will be a good year to be a seller because there are fewer homes on the market, propping up prices, and mortgages are more easily available.

Inventories of unsold homes in November amounted to 4.8 months of sales, the lowest level since before the housing meltdown, according to the Center for Economic Policy Research. Existing home sales rose 5.9 percent in November and are up 14.5 percent over a year ago. New home sales grew 4.4 percent that month and were 15.3 percent above year-ago levels. As of late last year, housing starts were up nearly nearly 27 percent over the same period in 2011.

“Sellers will be in control next spring as inventories are low and financing is available,” says Ron Throupe, assistant professor at the Franklin L. Burns School of Real Estate and Construction Management at the University of Denver. “You still hear some stories of buyers not able to get financing, but I think lenders are slowly working this out.”