As housing prices continue to drop, real estate experts believe that the housing crisis may not be over even though the economy appears to be attempting a sluggish recovery[1]. In January of this year, residential real estate prices fell 3.1 percent over the year prior, with Phoenix, Minneapolis and Chicago leading the pack with precipitous drops of more than 9 percent in some cases. Analysts believe that the rising tide of foreclosures on the market will continue to swell the backlog of available homes for sale and create downward pressure on the housing market, “probably for the rest of the year,” according to Standard Charter Bank economist David Semmens. Semmens forecast the drop last year, saying that “[prices] won’t turn around until you have consumers feel that housing is genuinely cheap and until they feel a lot more secure in their labor market position.”

Of course, there are also experts out there insisting that single-family home sales are actually on the rise. While national numbers say differently, in isolated markets – Washington D.C. is the most notable but there are others like Knoxville, Tennessee – single-family home sales are headed up. Sales prices in these areas have skyrocketed 19 percent (Knoxville)[2] and D.C. properties have shown 10.7 percent appreciation in the past two years[3]. However, local realtors are confused by some of the numbers, saying “MLS numbers show up and I show down,” and recommending caution to home-buyers looking to invest based on potential appreciation of property.

Do you think that the housing market is on the road to recovery? Are we there yet?

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