Anchor Intro: The biggest investment most families will ever make is their home. So it's unsettling when home prices are dropping. But what goes down can go up. Today Bankrate.com shows you how to spot a housing turnaround.
Voice over 1: By almost any measure, the American housing market has undergone one its toughest periods since the great Depression of the 1930s.
Voice over 2: But nothing drops forever. How do you know when the turnaround has finally arrived? While all local markets are different, there are some rules of thumb that can help you get ahead of the curve.
Voice over 3: It all comes down to supply and demand. So first check supply: Ask a local realtor how many unsold homes are in your neighborhood. The fewer, the better, so see if the supply of unsold homes is trending down.
Voice over 4: That's supply. Now, demand. If jobs and population are increasing in your community, so is demand. See if your local unemployment rate is going up or down. Check the job listings. Job growth is key to housing demand.
Voice over 5: ...especially if houses are affordable. Affordability is measured by seeing whether the average paycheck in your area can support the average house payment in your neighborhood. It's something you can find free for most cities on the Web.
Standup: The mystery behind house prices really isn't a mystery. It's simple supply and demand. And all real estate is local, so try researching the local trends in your market and see if you can predict the future of housing prices where you live. For Bankrate.com, I'm Kristin Arnold.