This market has been ravaged by the sinking economy. After many months of disappointing home sales figures the market seems to be turning around. Pending home resales rose unexceptionably 2.1% in February. This modest gain does not make up for the 2.8% decrease in home resales that was reported only a month earlier.
This could be part of a trend in which the quantity of homes available has finally caught up to the demand.
The graph below shows the decrease in availability in vacant new homes currently and when the crisis began in 2006. For a real recovery to pick up in this industry demand and spending from the consumers will need to increase. The lending practices of the banks will also need to open up.
Home prices will have to rise because the quantity of new homes on the market has fallen. When the prices will rise will all depend on consumer sentiment, banks lending, and how the economy fares over these next few months.
Fortune.CNN
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