Hope for Housing Comeback

Economist Richard Greene is taking an optimistic tack regarding his latest forecast for the beleaguered U.S. housing market. He points to the latest Case-Shiller report as a harbinger of good things to come, noting that housing inventories are low compared to historical standards, prices are lower than ever, and the Home Affordable Refinance Program can now accelerate amortization. For more on this continue reading the following article from Economist’s View. 

Richard Green makes a prediction:

Maybe I am too eager to believe it, and...: ..I expect to be smote down for saying it, but I think the two month old, mediocre, Case-Shiller number that came out today is consistent with the idea that the housing market will really come back big this year (I said so in the paper and on the radio today, so I might as well say it here).

Inventories in many hard hit markets are now low by historical standards. Time on market has fallen. HARP II can accelerate amortization (which is its most important feature). Prices are really cheap, both when the user cost they produce is compared with rent, and when compared with incomes (by World standards).

 This blog post was republished with permission from Economist's View.