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Real estate market strength has been big surprise in the world.
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The figures in US from the National Association of Realtors show that pending home sales for July increased by a 3.2 percent margin, bringing the organization's Pending Home Sales Index to 97.6. This is a 12 percent improvement over last July's figures, and the highest level for the index since June 2007.
There is strong new reports that the global real estate market is hitting the bottom and some impressive positive news is coming from real estate markets around the world.
In the U.S., the real estate market has yet to hit the bottom, but at least it is very close.
There are 2 factors that would determine recovering the real estate market: one is when job losses stop and new jobs are created and secondly when the real estate prices are realistic reflections of what people can afford to buy.
The news that the real estate market is recovering based on recent sales doesn't really reflect real recovery.
What is happening is that people are buying houses at bargain prices. The value of sales is up and this is a good sign but still the real estate market would probably start recovering by next spring.
Around the world there is positive news in India where there is a huge demand of the population for real estate that is the main factor for the real estate boom--and also in the Middle East where the population growth in 20-25 years is estimated to triple.
The European real estate market mirrors what is happening in the U.S. There are some signs of improvement in Africa and Latin America but not as strong as in Canada, India and China. The Canadian Real Estate Association reported that realtors sold 50,270 units sold via the multiple listing service last month. That's an 18.2 per cent jump from a year ago. It also marked the first time sales had topped 50,000 in July. Sales of existing single-family homes jumped 55 percent in the 2009 second quarter compared to the 2009 first quarter. Realtors sold 18,141 homes in the second quarter.
In China the strength of the property sector has been another big surprise. Property sales were up 53% in the first six months from a year earlier, according to a survey commissioned by the statistics bureau and published in the China Information News, while nationwide prices averaged across 70 cities climbed year on year in June. This masks the fact that in second and third cities prices have been strengthening much more. Property normally accounts for about 25% of fixed asset investment in China and is a key form of wealth holding for most Chinese. Optimism about housing prices will translate into greater consumer confidence.
Chinese commercial real estate sales have increased in the first half of the year, recording more sales that the US and UK markets combined. Global commercial real estate sales are expected to continue growing in the second half of the year, which analysts believe will be the first step to global economic recovery.
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