New Homes Held Their Own Against Foreclosure Houses in November

Although foreclosure houses pose stiff competition when it comes to sales, new dwellings did well in November all around the U.S. Latest housing industry data showed that sales of new homes surged by 5.5% for the month when compared with October. According to the U.S. Dept. of Commerce, around 290,000 new single family housing units were sold in November all around the country.

The nationwide figure presents an optimistic outlook for the local Los Angeles Real Estate market since the city has been one of the metro areas that have struggled to sell newly-built houses since the start of the foreclosure crisis. And although nationwide November sales were still down by more than 20% when compared with the same 2009 month, local realtors are optimistic that the national improvement will eventually trickle down to Los Angeles and the rest of California.

The improvement in new residential sales is considered significant since homebuilders are usually forced to compete with low-priced foreclosure houses in their areas. Although November showed a surge in new dwelling sales, their increase did not take much away from existing residential sales as the number of previously owned houses sold during the month also jumped compared with October.

Locally, realtors are predicting that the Los Angeles Real Estate industry will remain weak until next year despite national sales improvements. According to them, both national and local housing markets will not be able to make any headway towards a sustained recovery until the status of the job market improves. However, they did admit that a modest recovery in the housing industry is possible by next year as long as job creation continues its upward path.

They also stated that, unless another major economic crisis happens next year, Los Angeles and the rest of the U.S. have a big chance of stabilizing the housing market in 2011. They predict that more job openings will be available by this year which would mean more people seeking new homes and further improvements in home prices. However, recovery will be slow and will likely be hindered by huge supplies of foreclosure houses and tight lending requirements, analysts have asserted.