Now three months into 2012, both the housing market and the overall economy are improving at modest rates. These improvements have inspired confidence in consumers, demonstrated by a 9.2% increase in pending home sales in February from the year prior.
Both home prices and sales are expected to increase in 2012. Lawrence Yun, chief economist for NAR, stated, “Falling visible and shadow inventory (bank-held properties), combined with a dearth of new-home and apartment construction during the past three years, assure that rents will continue to rise, with likely home price increases in 2012.”
As rents continue to rise, buying becomes a more and more attractive option as home affordability, or the percent of income it takes to pay the mortgage, continues to be among the most favorable inhistory. Trulia’s Winter 2012 Buy vs. Rent Index, which measures the relative cost of renting compared to asking prices of homes found the in 98% major metropolitan areas sampled, it was more affordable to buy than to rent.