According to news reports, the downturn slide in home prices may continue for another three years. Homes in default, or foreclosure, that may be offered for sale are preventing the market from bottoming out after a significant plunge in real estate values over the past few years. These properties, called shadow inventory, are in addition to homes that are vacant or that may soon be put on the market by owners.
The issue right now appears to be that there is more supply than demand. And much of this supply may actually be homes that are “underwater”, thereby necessitating the need for a short sale. Short sales are seeing a strong rebound as banks are increasingly trying to work with borrowers to approve short sales, and new federal programs are also encouraging more short sales.
Nonetheless, the continued rise in supply is a threat to all efforts attempting to boost the housing market while potential home buyers await better deals. Since more price declines are required for a legitimate rebound, it may take three years before we can actually expect a rise in home values.
It is expected that once prices bottom out, prices will increase at a rate of 1 to 3 percent per year. This means it may take more than 10 years for the market to return to its peak. Regardless, it appears as though we can look forward to the recovery, in the real estate market, to begin some time in 2014.
The Miami lawyers at Alvarez & Barbara, LLP, are on your side. We are experienced trial attorneys who will help you understand your rights and options under Florida and federal foreclosure laws. Contact our law firm today for a free consultation and case evaluation.
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For a free consultation with a Miami lawyer familiar with the local real estate market, contact Alvarez & Barbara, LLP, today. We represent clients in Miami, Homestead, Hialeah, Coral Gables, and throughout South Florida.