In a distressed economy that has been particularly brutal on the real estate market, good news about the state of home prices and sales would make for quite the Christmas present at a time when we’re all out bruising our credit cards. What would be even better is if these statistics about the housing market were actually true.

Well, merry Christmas—because they are. It is true that the real estate market is far from where it was before the mortgage crisis of 2007, but the statistics regarding home sales and prices from October to November are very encouraging. Sales of new houses rose 5.6% and the median price of a home in the nation rose to $170, 600—up .4% over the same month in 2009. Take into account that the number of foreclosures is down and things are starting to look quite good for a market that has been anemic for far too long.

And while these numbers are very encouraging, we need to understand what they are not telling us. For one, the sale of distressed properties though short sales are included in these numbers and could indicate a rise in desperation amongst homeowners. However, the number of properties sold well below market value hasn’t changed much since October-November 2009 so this theory really holds no water.

Another potential problem with these numbers is that because they an agigation of real estate data from across the nation they seem to imply at that all markets are on the up. Moreover, they mask the reality that there are housing markets out there that are not improving and actually hurting badly. Las Vegas, for example, has seen a whopping 11.4% drop in home sales and a median home price that has dropped 3.1%

But let’s not be too skeptical here. It is true that while there are real estate markets that are still in pain and not seeing any of gains we see on the national market. Additionally, these numbers are far from a sure sign the nationwide market is on a right track and that the positive gains will continue into the months ahead. However, these numbers should inspire some optimism about the housing market and lead current homeowners to feel better about the future of their houses. One can never discount the impact of psychology on market forces.

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This is filed under National Markets.


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