Thursday, February 10, 2011

5 Reasons to Buy Real Estate or a New Home Now

The term “housing bull” hasn’t been heard much since the Great Recession was burned into the American consumer’s psyche. In fact, bearishness in the housing space has become the new normal, with many potential buyers just deciding that they will wait on that new home until conditions in the market begin to improve — if they ever do. Similarly, many investors won’t touch housing stocks with a 10-foot poll — from the obvious laggards like PulteGroup (NYSE: PHM), which is off -30% in the last year, to builders bouncing back like Toll Brothers (NYSE: TOL) which is up double-digits so far this year.

Well, those conditions are indeed beginning to improve, and that means right now could be the best opportunity to get in on a home at a very attractive price. Let’s take a look at five reasons why pulling the trigger on a new home purchase now could be the right financial move.

Home prices are starting to climb

According to a report from the National Association of Realtors (NAR), sales of existing U.S. homes jumped 12.3% in December. The upbeat month for home sales data comes at the tail end of what was a weak 2010. Annual home sales saw a 4.8% drop in the metric from 2009 levels, but the final month rise in sales could be the beginning of more upside in the sector. The NAR report also shows that although there is still a lot of inventory in the property market, those inventories have been gradually going down. Inventories in December of 3.56 million homes represented 8.1 months of supply, compared with 9.5 months in November. (more)

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