According to Clear Capital, U.S. home sale prices dropped by 3.2 percent during the first half of 2011, with median home prices falling to $170,000 (despite a 0.9 percent increase in the second quarter).
And according to BusinessWeek, home prices will likely continue to fall, then stabilize, with a rebound in 2012 as the overall economy grows stronger. The research indicated that three years should be ample time for the U.S. economy recuperate and for the country's housing inventory to shrink to normal levels. When this happens, housing prices will be determined by local issues like job growth and zoning instead of national or international issues (global credit crisis, anyone?).
And while home prices are likely to keep dropping for a bit longer thanks to the influx of foreclosures, the market is closer to the bottom than the top. Prices are expected to drop for another year and then stabilize before starting to grow with incomes.
The more immediate good news? From now through 2012, many families that couldn't afford to buy a home when prices skyrocketed will finally be able to get in on the ground floor. The National Association of Realtors' Housing Affordability Index has jumped to the highest level since recordkeeping started in 1970.
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