Overlooked Signs the U.S. Housing Market is Turning

In San Francisco, a 1,600-square foot rancher listed for $179,000 drew multiple offers last month with a high of $210,000 in cash. The panicked buying- fueled by buyers' fear they'll miss out on firesale prices- belies the doom-and-gloom evoked by recent reports of rising mortgage delinquency rates and foreclosure activity. The U.S. housing-market turnaround has started in the nation's hardest hit markets. The median home price is expected to continue rising at a healthy clip in months ahead since it's now at the level of nine years ago, before the bubble began inflating. Total sales closed in March showed flourishing demand, the fourth best on record. The specter of rising foreclosure- born now of the recession rather than just overleveraged subprime borrowers- is the wild card in future health of the U.S. housing market and the economy by extension. Most important for gauging the strength of the nationwide market is how conditions are improving in the most-depressed regional markets. With those markets now stabilizing, banks are no longer anxious to dump real estate owned properties fearing they'll get appreciably less three months from now for their foreclosed properties.The new goal: to maximize the value of supplies in hand rather than unload it helter-skelter and torpedo the housing market like thye did while they were shell shocked by the devastation they'd wrough.Banks also will be less likely to want to part with their "toxic assets" knowing the most-scorched, still-serviceable mortgages will be the most valuable on a credit-risk markup once the economy recovers.