Beware of ‘fantastic deals’ being offered on US properties!

publication date: Feb 7, 2011
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books

Beware of ‘fantastic deals’ being offered on US properties!

US Property Prices

Just before you rush into buying so called ‘bargain’ deals in the US, bear in mind that the pundits are predicting a pretty rubbish year for the US property market.

According to their report, ‘single family’ housing starts were up in November, but the building of larger properties were down, but overall, the market is still subdued. This is especially the case as any new build growth is off an extremely low base.

From a price perspective, after four months of decline, there was an insignificant increase of 1.3%, albeit that prices were still down versus the previous year. Very few of the American indices are showing any signs of recovery in the market:-

  • The Case Shiller monthly 20-city composite index reported a decline of 0.8 percent, on an unadjusted year over year basis, in October. This was the first YOY decrease in nine months.
  • The 10-city index has shown YOY increases for nine months now, but the rate of increase has been decreasing for the past five months.

Another home price measure, the Corelogic House Price Index, showed a 5.1 percent decline in prices in November, on a non-seasonally adjusted year over year basis. This was the fourth consecutive monthly decline in this measure.

So although you may be being offered some ‘bargain’ properties in the States, make sure you are not paying highly inflated prices and are definitely buying ‘below market value’!

For more information visit the Mortgage Bankers Association website.


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