Wall Street investors think the housing market is bouncing back.
If you think that now is a great time to buy a house, Wall Street investors are backing you up. There's been a huge uptick in buying of
homebuilder stocks. Recently, the Supercomposite Homebuilder Index rose 17.5 percent in one month, making it the biggest gainer of all 147 S&P groups, according to a report in Business Week.
While it's true that homebuilder stocks rise well ahead of an actual upturn in
housing prices, investors think a significant rally in homebuilding is still on the horizon, and they don't want to miss it. What would that mean to you? Homebuyers have a longer-term perspective and aren't much worried about timing the market. Still, if you are in the market for a home, the statistics are certainly encouraging.
Some economists believe, however, that housing prices are still too high in some parts of the country. In these areas, they think prices could fall further at least in the first half of 2007. Analysts for JPM Securities in San Francisco say it takes a while for sellers to realize what the real price is for their
homes. At this time, it's not the highest price their neighbors got plus 10 percent. Sellers are becoming more realistic about home values. At the same time, buyers who find a home they want could still find a bargain. That may not be true next year or the year after.
