Condo Market Analysis: Is The Bounce Back Here?

With the close of 2011, and the start of a new year, the real estate market is forecasted to improve; but ‘when’, ‘where’, and ‘how much’ are completely different questions. Hard hit areas such as Miami are expected to make a bounce back due to increased foreign investment, while Seattle is experiencing continued sales of over $1 million. Inventories are down, prices have leveled but many markets are still sluggish.

After the burst of the bubble, most developers closed down shop, leaving the current stock of homes as the only homes available. But it is now a couple years later, and inventories are drying up. The supply of South and North Carolina condos has dwindled. With very few new developments, prices have risen slightly, but experts believe we will continue in this buyers market for some time. We are seeing people commit to purchases, and we should expect to see this trend continue.

Foreign investment has become an even more important aspect of local real estate markets after this last recession. We have seen a decrease in foreign investment in Washington DC condos, while we have seen a drastic increase in investment in Miami. What started, as a popular vacation spot for South Americans, has become a hot bed of foreign investment, South Florida’s condo inventory has fell, as these buyers could not pass up the great deals.

We have seen continued decreases in prices throughout most markets though last year. Since the peak of the bubble, the price of Seattle condos have fallen over 30 percent, not to be out done by cities a bit farther south like Las Vegas or Phoenix, both of which have current prices below half the level of peak prices. Seattle should expect continued low prices, as should most markets.

Most markets have seen increases in sales over the past year, leading to the stabilization of prices and the decrease of inventory. We expect sales to continue to increase over 2012. Sales are still relatively low, but signs of improvement are here, developers are starting projects again, and buyers are confident again. Expect continued sale increases throughout 2012, especially in the markets we plan to watch.

Texas should expect continued improvement, with two cities on our list of markets to watch. The technological center of Austin, as well as the military center of Houston, should both expect positive gains in sales and prices. Neither area was hit hard by the recession, and therefore neither has too much ground to make up. Our nation’s capital should expect improvement as well; Washington DC condos and single-family homes should expect continued increases in home sales as well as stabilization of inventory. The bounce back may not be here quite yet, but we should begin seeing more consistent improvement over the next year, as the real estate market begins to readjust itself.