Slowly but surely property prices in the US have been leveling out and even increasing in some markets. In the New York area, real estate prices suddenly fell to the lowest levels they have been since 2004, well before the housing bubble burst. Part of the reason that property values are decreasing is the large amount of people falling behind on their mortgages. In select areas of the New York metro area foreclosure rates increased by as much as 20%. While this is good news for real estate investors and first time buyers, those that already own property in the New York area are losing equity in their homes.
Real estate experts believe that the property market will finally bottom out sometime in 2012. Throughout the entire US property prices are falling as well. With the average home being valued at approximately $170,000 and thousands of homeowners walking away from their houses because their mortgages are underwater, it could be another five or more years before the real estate market is able to fully recover. The Obama administration previously instructed lenders to assist homeowners that were having trouble keeping up with their payments, but it was recently found that interest rates were only reduced temporarily.
In addition, banks have made it much more difficult for buyers to qualify for loans. Typically, applicants will need to put down 20% of the value of their homes before they will even be considered. Real estate agents in New York are optimistic about the housing crisis, however, the statistics show a different story.
