Two articles ran in the Wall Street Journal this week, both by the same author, Nick Timiraos. (click here for the article Nick wrote featuring MACK). The first article spoke to home prices rising by their largest percentage in the last seven years during the second quarter. Ivy Zelman, chief executive of Zelman & Associates, and one of the most respected analysts on Wall Street, was featured in the article and has officially raised her 2012 price forecast by five percent. ”With every passing month, distressed homes are being absorbed at better and better prices” she said. (Ms. Zelman is hosting a national conference in Washington D.C. featuring the CEOs of many Fortune 500 companies, as well as MACK!)
The other article written this week spoke to a RISE in mortgage delinquencies and foreclosure filings, to the point that nearly 6 million households (11.9% of all mortgages) are more than 30 days past due or in foreclosure.
Wait, so which is it? Is there a shortage causing prices to go up or is there still ample supply? At MACK Companies, we believe the answer is … Both. Mortgage rates are in the low 3s (No one reading this email has EVER seen a lower interest rate) and there is tremendous demand for quality single family housing in our country, both for rent and for purchase.
So prices are rising and inventory is still plentiful…what an excellent time to be a single family investor!