Winans Projects Potential Impact of Tax Changes on Housing

Releasing the company's most recent Real Estate Index, ""Winans Investments"":http://www.winansinvestments.com/ is declaring that housing's ""bear market"" is over. Tempering the survey's positive findings, however, the company's economists emphasized that changes in tax laws could slow or stop the market's recovery trends.

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According to the group's report, new home sales have risen by 26 percent nationwide from December 31, 2010, through the present. During that period, the West has seen a 33 percent increase, the Northeast experienced a 50 percent uptick, the South received a 25 percent boost, and the Midwest saw a more modest 10 percent improvement.

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Looking at pricing around the country, Winans Investments found that new home prices in the U.S. are up 3 percent since December 31, 2010. By region, pricing rose by 3 percent in the West, 1 percent in the Northeast, 5 percent in the South, and 17 percent in the Midwest.

""While new housing price advances and high sales activity are encouraging, credit conditions are still problematic,"" said Ken Winans, the company's founder and president. ""Past real estate bull markets started when the average time it took to finance and sell a new house dropped below 3.5 months (i.e., easy credit). Currently, it is taking nearly six months on average nationwide.""

Within its study, the company noted that the post-crisis climate for residential real estate marks the longest ""bear market since World War II; however, this home value slump of 23 percent is not record setting."" According to the survey, the steepest decline in U.S. home pricing was seen between 1929 and 1932, when prices slid by 68 percent.

Concluding his statements, Winans issued a warning to borrowers and the industry, stating, ""To make matters worse, the possible loss of the mortgage tax deduction could further limit credit to potential buyers of higher-end properties. With these financial headwinds, I don't see a robust nationwide housing boom anytime soon.""