The San Diego Union Tribune reported today that several indices suggest that the housing recession may be improving. San Diego County sold home prices were up for a second month. The S&P/Case-Shiller Home Price Index showed that prices are beginning to rise a little in most large US cities. The Federal Housing Finance Agency house price index rose slightly in May and June. And the Conference Board consumer confidence index rose in July.
Such data may have several beneficial effects on the housing market. Potential home buyers may enter the market, feeling that prices are likely to rise if they wait. Rising prices may encourage people to avoid default since they foresee restoration of equity in their homes.
Most of the increased sales are in lower priced homes. Higher priced homes are not selling well. But among starter homes there are even cases of competitive bidding pushing the prices up.
This represents more evidence that the housing market is beginning to recover. It may be the ideal time for potential buyers to begin shopping before prices start to rise significantly.