Will the market recover in 2012?

Is the housing market is slowly recovering?  NAR’s Chief economist, Lawrence Yun, recently predicted a 4% increase in sales in the next year. As well, Celia Chen of Moody’s Analytics estimated home sales to increase perhaps over 20% next year.  

The only major concern yet that might dampen a good recovery, is weakened consumer confidence. Buyer attitudes have seen slightly modest improvements, better than the middle of the year that seemed less certain.  Going into 2012, any changes in buyer confidence will likely affect any continued real estate recovery.

Although prices have been predicted to soften in the first two quarters of 2012, moderate levels of appreciation by year’s end might be seen. But if prices continue to fall, and more homeowners show negative equity, defaults on mortgage obligations and foreclosures could occur, causing a relapse in consumer outlooks.

However a significant increase in residential real estate transactions could help bolster any loss of confidence in a housing recovery; the first half of2012 will tell the tale.

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