US property market set for price falls

Analysts are predicting price falls in the US property market in 2011, those looking to buy real estate in the country may be interested to learn.

Despite residential sales rising during August, activity in the sector is still low and the market remains weak, CoreLogic senior economist Sam Khater claims.

According to the latest index from the company, there was an increase in sales last month of 7.6 per cent - boosted by the end of the homebuyer tax credit scheme.

"Over the longer term, negative equity and high unemployment serve as the main obstacles to a more resilient home sales market," Mr Khater explained.

It is this negative equity which is likely to keep potential sellers on the sidelines, while high unemployment keeps buyers at bay even though mortgage rates are at an all time low, the expert said.

Meanwhile, the latest figures from the National Association of Realtors paint a similar picture, showing that sales are down 19 per cent from last year.

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