american property hopes for better 2012
News Posted On: 16 December 2011
Well, it's that time of year again were we can start to stop thinking about the current year, and look forward to the next one.
Let's face it, 2011 has been a pretty miserable old year for the global property industry, and few have had a harder time of it than the yanks. Will 2012 be any better for our "special partner" next year?
The simple answer is: probably yes, for the main reason that you have to ask how much worse things can really get, and it is when things can't get any worse that they tend to start improving.
Having said that, prices in the US are currently back down at 2003 levels on average, yet the most recent available data showed prices falling sharply again after a period of stability. At the same time you have high unemployment at 8.6% and there are real doubts over whether Obama even has a plausible plan to bring it down.
So even if things can't get much worse in terms of pricing, they can sure as hell go along sideways, not only in 2012, but for the foreseeable future.
On the other hand, there are some signs of hope. The rental market is particularly strong, and this is fuelling strong sales of multi-family properties. It is also fuelling more investors to come in and buy up the repossessed properties, and we really need to see that glut cleared before we can even think about recovery.
At the same time the low prices mean that affordability is at a 30 year high across the states according to well respected data. The only thing stopping many buyers is the lack of mortgage availability. That is a very easy target for the government to hit. However, in order for the banks to lend we will need to see an improvement in the profitability of the global stock markets, but this could start to turnaround in 2012 very easily.
No one knows for sure, a lot will depend on whether or not the Eurozone collapses. If the Eurozone stays intact, and the government tackles unemployment then there is a chance that 2012 could be the first year of recovery in the American property market.
Written by Les Calvert
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