Home prices up for 1st time in 3 years

Just as we predicted in our June 12 post, home prices rose this past month thanks to all the activity at the lower priced tiers and foreclosure activity. Of course you didn't have to be an expert to see this coming, but nevertheless, paying attention the details is always a good idea when predicting the future.

So what does this 1 month say about the future. Absolutely nothing in our humble opinion. Until the job market picks up, this uptick is simply a short run up thanks in part to what we learned in high school about supply and demand. It also helps that consumers tend to over react one way or the other when the pendulum swings. Regardless, this is a good start.

Over the next few months, we should keep an eye on home prices, as well as the job market and new construction numbers.

Here is the article

Government report says initial construction of U.S. homes rose to an annual rate of 582,000 units last month.

Some more indications of stability in the housing market reported today on CNN. The rate of new construction better than expected. With the low end homes seeing high demand, and now new construction numbers pointing up, looks like we've bottomed out barring another flood of foreclosures that some expect in January of 2010. New construction numbers will be good indicators of any stabilization if they hold up over the next few months.

CNN Article