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How Long Will Low Prices at Foreclosure Home Auctions Last?

The low prices of properties at foreclosure auctions provide home buyers and investors the best ever real estate bargains. However, housing experts claim that such great deals for buyers will not last long, given that the housing market is starting to recover.

Low Prices at Foreclosure Home Auctions

Most of them are urging homebuyers to make a purchase now if they want to secure a great deal. A lot of industry observers are predicting that prices of homes will rise as early as the middle of the current year in some U.S. areas.

Home Prices to Rise Soon?

A huge number of investors and independent buyers have taken to purchasing properties at home auctions, mainly because of the very low prices of these pieces of real estate. Prices declined by 4% in December of last year, motivating bargain hunters even more to secure purchase deals.

However, housing experts believe that prices will be rising soon, given the improving condition of the residential property industry. They claim that even with the anticipated increase in foreclosure numbers in the coming months – mainly due to the settlement between the government and lenders – prices will remain solid and will slowly increase come the third quarter.

Reason Behind Optimism

Housing analysts predict that even with new foreclosures entering the market in the coming months, prices are unlikely to decline to a new low and are actually expected to climb up in certain U.S. markets. This optimism is based on the fact that more and more properties are being snatched by investors which will somehow offset the potential impact of additional supply.

They claim that even the increase in contract cancellations during the month of February is not a sign that the home buying frenzy is letting up. They explain that these cancellations are more due to appraisal and documentation issues and are not caused by declining interest from buyers. They add that home buyers should make their move now as prices are expected to rise soon.

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