Here’s What To Expect From The Housing Market For The Rest Of 2012

2012 has been good to the US Housing Market. In most places home prices are up, demand is up, money is super cheap, and transaction volume is up. Banks are unloading their backlog at steady but not disruptive pace. Not surprising with the improving market conditions, new delinquencies are declining rapidly. The press and traditional housing market data folks have caught on.

 what should we expect for the rest of 2012? Do we dare call it a “recovery”? Here’s what you need to know:

1. Home prices across the US are already up 10% year-to-date. You’re going to seefive more months of “Up” headlines before the next cycle of home price declines make their way into the news.
2. Note that our earliest leading indicators – the data that leads 6 or so month out, have plateaued and are showing the end-of-year declines. Nothing scary in this data yet. Most of the rest of the year is dominated by bullish headlines.
3. In tandem with home prices, rents are climbing. I’ve described this virtuous cycle previously.

All of these factors combine to make real estate investing a hot market for the rest of the year. Lots of cash that has been sitting on the sidelines is now chasing a few properties with cheap financing and strong and improving yield. These are the makings of a bull market.

So there you have it. That’s the second half of 2012. Amaze your friends with your prescience.