Los Angeles - For the rest of 2005, housing prices will continue to move upwards in major markets - appreciating from two to eight percent -- across the United States, according to economists from the USC Lusk Center for Real Estate.
Reporters covering the housing markets nationwide can find expert sources on a number of issues:
•The waiting game may not pay: Potential buyers "sitting on the fence" waiting for prices to drop should consider making their moves before the end of the year to take advantage of tax breaks from mortgage interest and property taxes. No housing bubble is going to burst and prices are not going to suffer a precipitous fall. But buyers need steady income and job security before assuming adjustable rate mortgages and interest-only loans.
•Financing is driving the market: New mortgage instruments continue to lure buyers into the higher priced markets with 40-year terms and interest-only features that last for 10 to 15 years. Current home mortgage applications are at record levels, according to the Mortgage Bankers Association.
•Fundamentals argue for more of the same: Despite a slight increase in mortgage rates last week, significant job growth will continue to drive demand in Los Angeles, Boston, New York and Washington DC while a shortage of available land limits supply.
•Speculators are moving on: Residential markets in coastal cities –San Diego, San Francisco, Miami – will be less appealing to speculators who are lured by rapid appreciation. Demand in these markets remains strong, however, because of their attractive lifestyles. High median home prices keep the rental market healthy.
•Sellers hold back, despite the "sellers" market: The inventory of homes for sale will remain steady, keeping prices stable, as many would-be sellers stay put because they:
a)can't afford higher priced estate homes in their neighborhoods
b)don't want to pay more in property taxes
c)leave their equity untouched to fund retirement
d)turn to remodeling current properties to accommodate growing families or elderly parents
The following economists are available to comment on the housing market:
•Stuart Gabriel, Ph.D., director, USC Lusk Center for Real Estate
•Raphael Bostic, Ph.D., director, USC Masters in Real Estate Development program
•Delores Conway, Ph.D., director, Casden Real Estate Economics Forecast
•Gary Painter, Ph.D., director of research, USC Lusk Center