Home Prices in the West Are Rebounding as Inventory Shrinks

Prices for existing homes here and in surrounding areas climbed by 25 percent during the 12-month period that ended in April, pointing to a decisive shift in the market realities of a place where foreclosed signs, abandoned properties and deserted neighborhoods became one of the most enduring symbols of the nation’s crippling real estate bust. But hold off on the fireworks for a moment. The rise in prices may be driven less by a resurgence in the local economy — real as it is — than by an inopportune dearth of houses for sale, as well as a steep decline in the number of bank-owned bargains hitting the market. Builders, wary of committing too much money to new housing in the aftermath of the recession and painfully slow recovery, did not have enough units available to match an unexpected increase in demand from buyers. Property owners, meanwhile, have remained on the sidelines, waiting for higher prices before putting their houses up for sale.

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