Although the housing market has stabilized from its historic plummet, prices are expected to continue to trend lower through September 2011, according to a new report from Fiserv, a division of Moody’s Economy.com. Areas expected to be hit hardest include portions of California and Florida, with projections for prices in Miami to plummet an additional 29%. Depending on your individual perspective, this is either another sign that the economy is far from getting back on track, or welcome news.
Prospective Sellers
News of falling house prices will not sit well with homeowners looking to sell their home. They will most likely not be able to get the asking price they were anticipating. As additional homes enter foreclosure, inventories will increase, which will keep prices low and push them even lower.
If you’re looking to sell your home, ensure you take the steps necessary to sell it as quickly as possible. This means presenting it in a manner that will attract a variety of buyers. It also means pricing it appropriately; remove emotion from your sale price. As a result of our attachment to our homes, we generally place a higher value on them than market reality dictates.
Prospective Buyers
Falling prices is great news for those individuals looking to purchase a new home, particularly if they don’t have a current home they need to sell first. You will continue to have a plethora of homes from which to select and can take your time to explore your options. If you feel like you’re not getting the deal you expect, simply move on; there will be many more houses and you will not have to settle. That being said, ensure you’re fair and don’t try to take advantage of the situation.
Considering how quickly and how much home prices increased, it should be no surprise that they have fallen so aggressively. It’s unfortunate for those who must sell their home or owe more than their home is worth; however, I don’t think falling home prices are a terrible sign for the overall economy. Rather it’s a natural part of the economic cycle. Your current situation will dictate what action, if any, you should take.