In a recent article from DSNews.com by Krista Franks she quotes economists from Capital Economics and the National Association of Realtors stating that the real estate market has started its recovery. They point towards “record low mortgage interest rates, job growth and bargain home prices” as drivers towards improving consumer confidence.
While 2011 did show a slight increase (1.7%) in existing-home sales over the previous year, the article did provide evidence that the recovery won’t be quick or dramatic. Distressed sales still represented more than 30 percent of sales and foreclosed home sales sold at a 22 percent discount from market rate in December. Capital Economics chief economist Paul Dales summarized this mixed bag of information when we said, “Housing still won’t contribute much to GDP growth over the next few years, but at least it will no longer subtract from it.”