US property prices could stagnate

Analysts across the USA are predicting a slow return to a healthy future for the country's real estate.

Property specialists predict further price reductions across the USA real estate arena before the market bottoms out. Falls of up to 5 per cent can be expected in the coming months and the next couple of years are not likely to bring any real price appreciation.

Foreclosures are of serious concern to industry observers, although the rate at which they are hitting the USA property market is not at the levels previously predicted, mainly due to government backed progrmmes - this in turn has helped to avert an even lower drop in prices.

Lower property prices do in general mean improved affordability for the real estate buyer but the recent fall in sales does not bode well for the future strength of recovery. While pre-owned sales dropped from December to January by more than 7 per cent, they are still ten per cent higher than the same time a year ago.