Searching for positive property news in December 2011 is a difficult task.  The euro zone is a shambles, the property bubble in China looks about to burst and commodity-price inflation is eroding real incomes on a global scale.

Whisper it quietly but there is one potential piece of good news on the horizon - the US property market.   

Although prices are still falling in most areas, the most recent monthly reports from both the NAR and Case-Shiller have reported an uptick in transaction volumes.

A new report from Goldman Sachs based on analysis of 147 metropolitan areas is also upbeat on the prospects of the US property market.  The bare bones of the argument is that prices are now so cheap, the market has over-corrected and will begin to return to its historical averages in the second half of 2012.

Although the mortgage market is still difficult and oversupply is a big problem, the report argues that prices are now cheap by all conventional measures including the simple price to rent ratio and as measured by the percentage of income spent on housing.

Excess supply and negative momentum are the main drivers of a projected 2.5% decline over the next 12 months but the later half of next year will see a recovery.

Goldman Sachs predict that the regions where prices have fallen the most will recover fast and hardest. 

These markets include Miami, Cleveland and Detroit.   The markets that have faired better over the downturn like New York will take longer to recover according to the report.

Taken on a country level, the US ticks all the investment boxes except one - mortgage finance.  Prices have already halved in many areas reducing risk and yields are in double figures.  The lack of non-status mortgage finance is the single biggest barrier for investors. Until now.

A product came across my desk last week offering 50% non-status finance on family houses in Atlanta. With prices starting at $50,000 and yields of 14%, the proposition is attractive.

If this is the start of a whole spate of mortgage-financed products in the US, it could be a very positive development for the industry.