Is your glass half empty or half full? Some economists are painting a rosy picture for the market in Syracuse, NY. Your agreement with their assessments may depend upon your investment personality.
Lawrence Yun, chief economist with the National Association of Realtors is optimistic about the Syracuse market these days. Predicting an upward trend throughout 2012, Yun believes that certain changes in the lending industry could boost the market even more.
One factor that is inhibiting market growth is credit requirements. In an understandable, yet over-reactionary move, banks are being over-cautious in their lending practices. Yun predicts that a return to “normal” standards would improve home sales by as much as 15 to 20 percent.
“A huge volume of cash sales, supported by the recovery in the stock market, show that smart money is chasing real estate,” said Yun. “This implies that there could be a sizeable pent-up demand if mortgages become more readily accessible for qualified buyers. The problem isn’t with interest rates, but with the continuation of unnecessarily tight credit standards that are keeping many creditworthy buyers from getting a loan despite extraordinarily low default rates over the past two years.”
Historically, sales of existing homes have performed higher than they currently are, however Yun believes that sales will rise, albeit at an uneven pace. “If we just hold at the first-quarter sales pace of 5.1 million, sales this year would rise 4 percent, but the remainder of the year looks better,” said Yun. “We expect 5.3 million existing-home sales this year, up from 4.9 million in 2010, with additional gains in 2012 to about 5.6 million — that’s a sustainable level given the size of our population.”
HomeVestor’s Local Market Monitor seems to agree with Yun’s assessment of the Syracuse market, as they named it in their top 20 rental markets to invest in. According to HomeVestor, “The ranking is based on three-year forecasts of home prices (this is pretty much a wild card in this market) and the gross rents resulting in a risk-return premium which is then compared with the national average.”
All of the real estate data points to Syracuse as being a great market for investors, as there are many foreclosure deals to be had, and Syracuse is listed among the top affordability markets by the National Association of Homebuilders.