Housing Recovery Reaches Lower End Of Market

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Over the past few years, home prices rebounded from the housing crash and local markets across the country began to normalize. But, despite the overall improvement, homeowners with lower priced homes – those that fell into negative equity when their home’s value dropped – hadn’t quite recovered enough to be able to sell or refinance their homes. Now, according to a new report from Zillow, the bottom third of many markets have finally recovered enough to put those homeowners in a better position. In fact, median values for properties on the lower end of the housing market increased to $101,400 by the end of last year – up from $84,100 at their bottom in January 2012. That rebound puts potential home sellers in position to sell their homes and move into a higher-priced house. It also coincides with an expected boost in the number of first-time home buyers entering the market. This development, according to Zillow chief economist, Stan Humphries, will help residential real estate achieve a full recovery. “In many ways, for the housing market to fully normalize, it has to start at the bottom,” Humphries said. “More lower end home sellers will help meet demand from entry level buyers, and these sellers in turn will enter the market in search of a slightly pricier home, which will entice more middle and upper tier sellers to list their home.” More here.

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