Tuesday, February 21, 2012

Does Houston Have A Problem?

It's the next round of home sales and pricing releases around the country. The newest chance to see if the various realty associations have cut down on adding to the negative publicity about the current real estate market.

This one from the Houston Association of Realtors is attempting to show a positive spin:


http://www.har.com/mls/dispPressRelease_print.cfm?month=02&year=12


However, they have a few too many statistics included. Serious real estate market observers will see right through this, and that's not good.

This story builds up the so-called rise in home sales and relative steadyness of home prices for January and the months prior.

But it also shoots itself right back down. The real reason for this is right there in the story. As in the part about the increase in foreclosures, and how they now account for a much bigger percentage of home sales.

Why is the home sales market "up"? Because more and more former home owners have been foreclosed upon. Take away those statistics, and, well, it sheds a different light on the current marketplace.

This is where Houston has a problem. As well as other cities. The current market isn't really "up". If fewer people were losing their homes due to financial reasons beyond their control, it would not appear as if home sales are up.

It is really foreign investors, flippers, and a few speculators who are buying the homes out there, and doing so because in many cases they get a below market deal by acquiring a foreclosure.

That even more people are being foreclosed on in the Houston area, while many other parts of the country are "reporting" that the number of foreclosures has dipped, certainly should not be treated as the "positive" news the HAR is doing in this story.

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