At Bottom for Real Estate Prices in Providence Area?

Could Housing be close to a bottom?

While I don’t like to overly dwell on National numbers, there was one statistic posted from a credible source I felt worth sharing.

Business Week recently reported an interesting statistic from the Case-Shiller Home Price Index.   Case Shiller cites that in some key large cities, the price of single family homes are now priced at or below what they should actually be worth, based on supply and demand factors. 

While the Case Shiller Index does not measure Providence, it does track the trends in Boston, from which Providence closely follows.  In the Boston area, it is estimated that the Median Price of a Single Family Home which is $324,000 is actually off 16% of its estimated “correct” market value. 

Admitedly it is impossible to measure whether we are at the bottom of the market or not based on a statistic such as this, but it is encouraging.  Other concerns for Providence and Rhode Island is the state of our economy and our high unemployment rates.  Plus, Providence tends to follow or lag Boston so we may see a bottom later.

It is also impossible to predict when we will reach a bottom but I think we are pretty close.  Plus, with interest rates continuing to decline, I think those that truly need to buy and can afford it will see early 2009 as an opportunity. 

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