Since the top of the housing market in November 2005, US house prices have been on the decline – and a rapid decline in many areas of the nation.
According to the Financial Post, it is too early to call a definitive bottom in home prices in the near term. Mortgage delinquencies continue to increase in the United States and foreclosures are gaining strength. However housing sales bottomed at the start of this year.
Currently nearly a quarter of all sub-prime mortgages are delinquent so there is ample supply of housing in the pipeline.
When the first home buyers credit expires in November then house prices may come under pressure again as that stimulus is taken away.
Coupled with low house prices, low interest rates provide an ideal environment for buyers to snap up foreclosure bargains. Low prices and low interest rates give buyers at foreclosure auction confidence and smart buyers are taking advantage.