Friday, April 23, 2010

A Housing Rebound?

There are several signs out this week that may be signaling that the housing market has moved past its bottom into a full-fledged recovery. First of all, existing-home sales jumped 6.8 percent in March, and are up 16 percent over the rate of March 2009. We now have roughly an eight-month supply of available homes, down from eight and a half months in February; the rule of thumb is that we need six months' inventory to have a healthy market.


More intriguingly, the Wall Street Journal reported that home builders in Arizona have started buying up land. There was actually a bidding war for some developed land in the Phoenix suburb of Gilbert, and there are reports of big land purchases around the country. At the very least, these people expect the price of land to increase sometime in the near future, if not the price of houses.


Home builders certainly have some of the best knowledge of where the real estate market is headed - and the most to gain from placing their bets properly. It's nice to see that even in an area like Phoenix, which was ravaged by the deflation of the housing bubble, people still see opportunities for growth.

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