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Mark Knold, chief economist for the Utah Department of Workforce Services, said prices have fallen to a point where potential buyers are starting to take notice, which helps explain some of the increase in home sales. And if home sales keep rising, prices will follow, he said.
"That’s why I think this is the year that prices will have hit bottom," Knold said.
Should I buy now?
In short, maybe. Here’s why:
Prices could still fall a bit more. Know that although the market is expected to bottom out this year, it isn’t there yet, especially for higher-priced homes. If you think you will have to sell in the next two years, it may not be the best idea to buy now.
On the other hand, mortgage rates are super low. At 4 percent (or less) this may be the lowest rate you’ll get in a long time. As the economy begins to improve, expect mortgage rates to rise.
Economic forecasting firm Moody’s Analytics also predicts home prices in Utah will hit a nadir this year, with modest home-price increases expected in 2013.
But the key word is modest. Many Utahns remain unemployed, underemployed or working for less pay and benefits than they did before the downturn. Others are in no position to buy a home because they owe more on their mortgages than their existing homes are worth and can’t sell without harming their credit.
"There are still headwinds," Knold said. "We don’t expect the housing market will come roaring back."
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