Are housing prices in our area on the rise?
Yes and no. Based on our area's median sales price we are doing better than 2 years ago with the prices now at $170,000. As you can see from the graph we are just now reaching the past prices of 2009. I think what most people are misunderstanding in the media is 'my home is now increasing'. That's maybe what 'you wanna' hear but it is not anywhere near reality.
Prices are no longer decreasing and it makes a difference in each subdivision how prices are being impacted. Live in a community where there are many first time home buyers or starter homes and you are definitely getting beat up with foreclosures pulling down the overall prices.
The more foreclosures in your area you can see this lowering effect with each one that pops on the market. Banks want to get rid of properties quickly and only think of overall market time. They want that 30 day price and that home under contract as soon as possible. If your home is competing during that time with a foreclosure, buyers will gravitate to those foreclosures like bees to honey. Everyone wants that deal!
If you are a buyer wondering what prices are doing I will explain what I've noticed so far. Multiple offers! Every foreclosure that comes on the market usually has multiple offers where the prices are getting bid upwards.
So that nice 'starting price' is a great attraction (you're like that bumble bee) but it's probably not what the house is going to close for! I have buyers currently losing out on 6 different homes and are being outbid with each contract. There are now problems that buyers are just bidding high for the sake of winning only to find out that the property might not appraise out.
So in that respect with buyers under the $125,000 price range, you are going to be in a bidding war which will indeed make prices rise in the near future. You might as well just jump in the fray, fight like hell for a house you like and hope that you win!
Source: MRED June Historical (not hysterical) Median Sales Price