I recently attended a presentation by Dr. Lawrence Yun, Chief Economist and Senior VP of Research for the National Association of Realtors. Naturally, everyone in the room wanted to know when the real estate market and the economy in general would should significant improvement.

Dr. Yun echoed what I have been hearing from other national experts, that we are at the bottom or slightly past the bottom, and trending upward. In Charlotte sales are up one percent over last year and we have two straight years of slight increases. Despite all the bad economic news in the media, there has been some job creation, new jobless claims are lower, and there is some recovery in the stock market- all things that should improve sluggish home sales.

What could impede the housing recovery? Proposed legislation that would require a 20% down payment on non- government backed loans, the possible reduction or elimination of the mortgage interest deduction, the lowering of conforming loan limits- all of these could potentially negatively impact the housing recovery.

The majority of experts, including Dr. Yun, predict a housing shortage in the next 2-3 years. Existing home sales in Charlotte are at 1997-98 levels and housing starts are levels not seen since the 1980’s- when interest rates were in double digits. The rise in population, combined with ever increasing rental prices, will eventually trigger higher demand for housing and it will take a few years to catch up with that demand. That should trigger a return to equilibrium or even a seller’s market.

If you are considering a move in the next year or two, keep an eye on market trends. With the historically low interest rates and home prices at pre-boom levels, it is a great time to buy. If you are thinking of down-sizing or moving up it might be in your best interest to sell now at a lower price but make it up on your new home and lower interest payments.