Despite Foreclosures the Real Estate Market Could be Recovering

The US economy is on a recessionary mode. Unemployment is at the peak level of 10 per cent. As people lose jobs even those with excellent credit history are faltering on mortgage payments. Subsequently, banks are taking over the properties. Hence, foreclosures have become common.

Economists are of the opinion that the market is recovering. Home values in some regions of East Bay are showing signs of recovery. Developers are of the opinion that they have been able to put the economic recovery behind them. Some are of the opinion that home values could dip. They are calling it a "double dip."

According to Zillow.com, home values in Alameda County increased by 0.06 per cent. In Contra Costa County, home values increased by .09 per cent. The average value is estimated at $338,652. The chief economist of Zillow, Stan Humphries says, "We see high levels of foreclosures still, and some worrisome demand-side factors as well."

Humphries also says that, "We are seeing weakening trends in home values, which we think are likely to go negative for the next few months." Even if prices dip it will not be very severe. The “double dip” in prices could happen because of the increasing number of foreclosures fuelled by high unemployment levels.

The Federal Government had come up with a program to stabilize the home market. As part of the program, the mortgage of borrowers is being revised, first on a temporary basis, and then permanently. However, the program started off on a slow pitch and not many homeowners have benefited from this.
Linnette Edwards of Prudential California Realty in Piedmont said, "In the regions closest to San Francisco with the better school districts, I don’t see a decline in price, I only see continued demand for these places."
Real estate agent Steve Dhillon said he foresees demand from buyesr who are planning to buy houses for the first time. He talks about a house that he remodeled in Union City. The property was listed for $588,000. Ultimately the house sold for $600,000.

In Alameda County, 1900 properties have been sold. The number is 40 per cent less than what it was years ago. Experts say that unless the employment scenario improves there is no way that the real estate market will stabilize. "What we’re seeing is the natural evolution of the market correction, which we saw a little bit of relief from in 2009, because of substantial policy support" an expert said.