In the month of October, pending home sales have risen 5.2% to 104.8. This is the highest indices since March 2007. Home prices are still 15.9% below the high before the housing crisis. Both the improvements in the job market, as well as continued low mortgage rates have been attributed to these changes nationwide. According to the Federal Housing Finance Agency Housing Price Index in August there was a .7% increase in home prices, nationally. Construction has increased by 1.4% in October and this increase tripled expert expectations. Low borrowing costs and lower property value ease have aided in the housing recovery. The lending community is skeptical however and borrowers must prove eligibility on a number of levels.
From large amounts down, to proof of income, lenders are practicing caution when lending to both developers as well as individuals. Guideline for borrowers have kept high risk borrowing down, however there are still agencies that utilize low borrowing rates to the aid of underwater home owners. Locally, there is very little inventory and home buyers looking to find reductions last year are sorely disappointed to find that those homes that were formerly available scarcely available, within and outside of their price range. These homes are either not on the market or have been purchased, leaving very little available. The new developments planned in Miami have been developed for those paying cash due to the lender specifications. There are 83 planned developments and the lender restrictions will determine the success of these projects. At the present rate, development is very rapid and the climate is ripe for more lender restrictions to ease.
