Freddie Mac released its U.S. Economic and Housing Market Outlook for February last week showing that while the housing sector is recovering, the level of housing activity is still near historic lows. And in many markets, especially those hardest hit such as the San Joaquin Valley, there is room for sustainable growth because of record high home-buyer affordability, a factor of relatively low house prices, mortgage rates and modestly rising income.
"Across the nation, most local housing markets have room for sustainable growth, particularly in home construction and sales,” said Frank Nothaft, Freddie Mac vice president and chief economist. “As the broader economy heals, expect to see more good news with house prices continuing their recent upward trend, and home sales and housing starts continuing to post strong growth rates. The macroeconomic recovery though 2011 helped to forestall further erosion in the depressed housing market. In return, housing is now 'showing some love' by contributing to economic growth, perhaps by adding close to 0.5 percentage points to 2013 GDP growth."
Freddie’s outlook predicts that existing home sales will pick up as the house price recovery allows homeowners who have been forced on the sidelines by negative equity to get back into the market.
Millions of families lost their homes to foreclosure after the housing crash hit six years ago. Now, some of those families are back in the housing market.
This new category of buyers is being referred to as "boomerang" buyers. It is difficult to quantify the exact number of boomerang buyers. Real-estate agents, mortgage brokers and home builders all say a significant number of new buyers are families and individuals who went through foreclosure as recently as three years ago.
Three years it the typical time period that buyers who defaulted on a mortgage must typically wait before becoming eligible for a mortgage backed by the Federal Housing Administration.
Sheri Aguilar is the president of the Lodi Association of Realtors and can be reached at Sheri@YourLocalAOR.com