The spring buying season and increased consumer confidence has led to home prices across the country accelerating at seven year highs, while offering signs of resiliency for the economic recovery, according to a recent Reuters report reflecting numbers from this past March.
The S&P/Case Shiller composite index of 20 metropolitan areas beat expectations by climbing 10.9 percent year over year from 2012. This increase was the largest since April 2006, just before prices peaked later that summer.
Compared to the previous month on a seasonally adjusted basis, prices in the 20 cities also beat economists’ forecast by rising 1.1 percent in March.
Further data demonstrated that consumer confidence has picked up in May to a five year high amid a record stock market rally and decreased gasoline prices.
Showing surprising resiliency as a tighter fiscal policy and $85 billion in spending cuts have been enacted, the housing and consumer markets have continued to perform better than the overall economy according to Sam Bullard, a senior economist at Wells Fargo in Charlotte, N.C.
“There are some individual circumstances that are helping to propel both of these a little bit stronger than what the actual underlying strength would suggest,” Bullard told Reuters.
With the positive forecast for the industry, real estate investment funds such as Dominion Partners Opportunity Fund are primed to see increasing profits.
“This report clearly reflects a positive swing in the housing industry, as well as the national economy.” points out Aaron Cuha Managing Director of Dominion Partners, a firm which acquires properties on a cash basis.
Industry insiders point out that if you are investing in bulk you are likely to underperform in a tightening market. “Real Estate is not a fungible commodity and investors need a scalpel instead of a cleaver to cut the best deals. It’s a house by house proposition,” explains Cuha.
Direct link: https://prnewschannel.com/2013/06/10/report-spring-home-buying-season-surging-consumer-confidence-leads-to-highest-housing-price-acceleration-in-seven-years/SOURCE: Dominion Partners
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