Basic economics will teach you that when supply is up demand will be down and when demand is up supply will be down. This is not the case when it comes to the availability of affordable housing provided from November statistics. Apparently the number of available houses is up and so it the number of home sales. With mortgage rates being at almost record lows, homebuyers who have not been able to afford homes the past few years are able to get out there and sign contracts. There is really no end in sight in the near future.
As more foreclosures loom in the coming New Year, increasing availability of affordable housing also comes into the New Year. More homes in foreclosure means there will be more houses that need to be sold and will likely be sold at lower prices. These lower prices coupled with lower mortgage rates will result in more buyers, first time and otherwise, being able to afford a previously lived in house. The New Year looks to bring a stability back to the market and a resurgence in the American dream.
Information for this article was taken from http://www.bloomberg.com/news/2011-12-29/pending-u-s-home-sales-climb-more-than-forecast-7-3-on-declining-prices.html.
