Check out this great MSN video: Will your home be worth more in 2012? Experts see a bottom this year, followed by a gentle upsurge in home prices.

Check out this great MSN video: Will your home be worth more in 2012?

Click on the link above to see the video

Hi Jean Robb here.  2012 looks better for real estate  Experts see a bottom this year, followed by a gentle upsurge in home prices.For those of you trying to gauge whether to sell, buy or rent in 2012, every scrap of wisdom helps. Here are predictions from a few trusted voices in real estate.

Homebuilders rally as 

housing market shows life

 Number of homes under contract for sale is at highest level 

in a year and a half.

By Benzinga

The National Association of Realtors reported Thursday that U.S. pending home sales rose 7.3% in November. This is the highest level of homes in contract in a year and a half. A Bloomberg survey forecast that November growth would only be 1.5%.

Consumers were buoyed by home prices and interest rates that have continued to remain low. The housing industry has shown signs of life as construction in new homes have increased and more have been purchased.

As the inventory of unsold new homes decreases, manufacturers of homes could see increased demand. The positive report affected several companies in Thursday's market, including PulteGroup (PHM +2.85%) and KB Home (KBH +2.98%).

Lowe's (LOW +0.87%) was also up 2.35%. A healthier housing market should lead to more people investing in home improvements, whether the goal is to prep them for sale or to renovate a fixer-upper.
Another company that should benefit if the housing market continues to perk up: Louisiana-Pacific (LPX +2.35%). It manufactures and distributes home construction products and materials.

While the positive housing data was enough to drive the markets higher this morning, investors should exercise caution in applying this spike to the overall housing market. While the demand for housing has increased, the appreciation of home values and construction of new houses still faces significant hurdles. As the economy slowly improves, it remains to be seen whether the housing market will come along for the ride.

FoxBusiness
FoxBusiness interviewed John Lonski, chief economist at Moody's Capital Markets Group, who sounds bullish on housing:

"Financially strong households that have spent money at Tiffany's and on cars are afraid of putting money in housing as they don't want to arrive too early," says Lonski.  "But we could be surprised at how vigorously the ensuing upturn of home sales becomes."

 

Tara-Nicholle Nelson
Inman News columnist Tara-Nicholle Nelson is an attorney and a real-estate agent, giving her a boots-on-the-ground perspective. She predicts:

• Prices will recover faster in cities with thriving high-tech industries. Among them: Silicon Valley and the San Francisco Bay Area; Austin, Texas; Massachusetts suburbs of Cambridge, Newton and Framingham; Rochester, N.Y.
• "REOs and short sales will become the new normal" as banks continue to foreclose and dispose of the backlog of homes on their hands. "Buyers will shift from considering whether to buy a short sale to understanding that they must be educated and prepared to do a deal with a seller, a bank (to buy an REO) or a hybrid of the two (to buy a short sale) to access the full selection of homes on the market."

Kiplinger
The summary beneath the headline sums up Kiplinger's outlook: "The bleeding is just about over. But don't expect a speedy recovery."

Writes the magazine:

The median home price in the U.S. has plunged nearly 40% in a little over five years, but the worst is definitely over: The market has finally wrung out the last excess valuations born of the housing bubble.

Assuming no further shocks to the economy (no safe assumption, given the fragility of the world economy) U.S. real estate will slowly work its way out of the red, Kiplinger predicts.

Among experts interviewed, Mark Zandi, chief economist at Moody's, says prices will drop no more than 3% to 5% in 2012, "setting the stage for gains in 2013."