The Truth About the Real Estate Market - NO Double DIP in the Kansas City real estate market

Last weel another housing market obstacle appeared in the form of Standard & Poor's Case-Shiller Home Price Index for March. Prices for 20 major metro areas dropped 0.8% for the month and were down 3.6% from a year ago. These numbers had some people claiming the double dip in real estate housing prices had arrived. 

The truth is that the Case-Shiller's longer term data reveals that in their 20 measured metros there was no double dip. There was an uptick in real estate values of 38.2% since January 2000. This shows that in real estate, you have to look at the long term picture, just like you do with your 401K. 

National average real estate home prices are also misleading. First, the national average rarely matches the price situation in a specific local housing market. Beyond that, distressed sales at substantial discounts make up a portion of that national average price. In fact, when distressed sales are excluded, home prices are off just 0.5% year-over-year in April, according to data aggregator CoreLogic. If that's a double dip, you'd need a magnifying glass to see it. Finally, the Mortgage Bankers Association reported purchase loan demand unchanged from the prior week and up 7.6% from a year ago. But MBA researchers do expect mortgage rates to rise significantly by the end of the year and continue to increase gradually through 2012.   

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Blog post written by the Dowell Taggart Team of RE/MAX Premier Realty

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