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2012 Marks the Best Home Market in 5 Years

December rounded out a positive year in the real estate industry. The increase in home sales has consistently increased resulting in 2012 being the best year for real estate since 2007.The National Association of Realtors said that December sales are up 12.8 percent from a year ago. This increase brought full-year sales to 4.65 million. Home sales have not been that high since before the recession, when home sales were at approximately 5 million.The increase in sales is helped by several different factors including near record low mortgage rates, lower unemployment and a rebound in home prices. These forces combines means it is easier for buyers to enter the market who had been sitting out for a few years. Combine these buyer incentives with the low home prices, and that means this is now one of the most affordable housing market on record, according to the Realtors group.Because this is a buyer’s market, the increased demand for homes led to the inventory of homes to fall to the lowest supply since January 2001. In December 2012, there were less than 2 million homes on the market. This makes prices increase. December saw the 10th consecutive month of year-over-year price gains, a trend not seen since May 2006. Median sales price for the year rose to the biggest gain in prices in since 2005 and the median number of days on the market was 73 days in December 2012, down from 99 days in December 2011. About a third of existing homes for sale in December were on the market for less than a month, NAR noted.These increases have been seen across the country with the Midwest leading the way with a 15.5 percent year-over-year increase from 2011. The South is in second place with a 14.7 percent increase and the northeast is not far behind. The West had the least increase, but still at nearly 9 percent up from last year, which equates to 1.23 million unites. Prices in the west had a significant price increase of over 17 percent since December 2011, which is the largest yearly proportional price jump of any region.A survey by the National Association of Home Builders showed builder confidence holding steady in January at the highest level since April 2006. Now is the best time to get in, but Realtors are predicting strong sales should continue into 2013 and beyond. It has a forecast for 5.1 million existing home sales this year, and 5.4 million next year, both of which top pre-recession numbers. "Conditions in the housing market look much better now than at the beginning of 2012, and an increasing number of housing markets are showing signs of recovery, which should bode well for future home sales later this year," said NAHB Chairman Barry Rutenberg in a statement.

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