By Les Christie
May 9, 2012
NEW YORK (CNNMoney) -- Ten hard-hit housing markets will record
double-digit price increases through 2013, according to a report
Wednesday.
And with mortgage rates low,
many house hunters have already started to pounce on bargains, said
David Stiff, chief economist at Fiserv, a financial analytics company
that prepared the forecast.
"Some markets may have overshot to the downside, and people are jumping in to try to catch the bottom," Stiff said.
Nationwide,
home prices will start rebounding late this year and gain an average of
4% a year over the next five years, Fiserv projects.
In a separate report released Wednesday by the National Association
of Realtors, the national median home price declined by just 0.4% in the
three months ended March 31 compared with the same period in 2011.
About
half of the 146 metro-area markets surveyed by NAR showed a price
increase, as buyers make inroads into the supply of homes for sale all
across the country. National inventory has dropped by 22% compared to a
year earlier.
"Given the steadily dwindling supply of inventory and notably higher
listing prices that are being negotiated today, prices are expected to
show further improvements in the near future," said Lawrence Yun, NAR's
chief economist.
Home prices will also be driven higher as banks opt for short sales instead of
repossessions. Repossessed homes sell for between 25% and 50% less than
comparable homes sold by conventional sellers, according to Daren
Blomquist, a spokesman for RealtyTrac, which markets foreclosed properties.
Bank repossessions often go through lengthy
foreclosure processes and long periods of vacancy, during which they may
deteriorate and lose value.
Fiserv's Stiff forecasts that Madera, Calif., will produce the
largest home price gain over the next two years. This market bubbled
during the housing boom, with the median home price jumping above
$300,000, according to the National Association of Home Builders.
Prices
have since tumbled 53% off their peak, to about $125,000. Fiserv is
projecting a price jump of 21.5% by the end of 2013 with 16.5% of that
increase coming next year.
Other double-digit gainers will include
Medford, Ore., with a 20.1% rise, Yuma, Ariz., with 16.7%, and
Corvallis, Ore., with 11.4%.
Source: CNN Money
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