Yes the real estate market appears to be making a bottom. The numbers that have come out over the last few months point to a real estate market that is extremely weak, but seems to be coming off the bottom ever so slightly. In recent weeks analysts on Wall Street and talking heads on financial television networks have been speaking extremely highly of the real estate market. I think it is a good idea for investors to understand that the real estate market isn’t getting worse anymore, but I also think they should be very careful about diving back into a market that still has a huge amount of supply.

Overall I believe that investors should learn a major lesson from the real estate market bubble that burst in the last few years; your house should be a place for you to live and not counted on as an asset or an investment that will grow by leaps and bounds. Yes your home will probably increase in value over time, but you are better off thinking of that as a bonus than you are counting on this for your future needs. Unlike other assets the market for a home is not always extremely liquid, as we have seen in the last few years.

The demand for houses is likely to improve over the next few months, but do remember that there is a huge amount of supply on the market that has been there for quite some time. In addition, there are many sellers that have decided not to sell their home during the recent downturn who may come out of the woodwork and want to sell their home as housing demand improves.

The bottom line is that the real estate market is showing signs of life, but it is far from being a boom area that investors should jump into right away.