The Wall Street Journal interviewed national economists whopredicted a slight (2.8%) increase in home prices this year. They also on average predicted a 0.5% fall in home prices next year. That is a sharp contrast to the double digit growth we've experienced for the past several years.
2005 showed a 13.5% growth.
Home price predictions varied widely depending upon region or city, from as much as a 7% average increase to a 10% decline for 2007. 20 economist predicted a rise in prices where 24 predicted a decline.
"We're starting to see inventories topping out and possible declining" the WSJ quoted economist Richard DeKaser of National City Corp.
Some are predicting that while the worst is over housing does remain a big risk to the national economy. The 3rd quarter housing slump subtracted 1.1 percentage points from the GDP according to the WSJ citing the Commerce Department .
Stable energy prices and jobs combined with the Feds control of inflation should help neutralize any negative impact the housing industry has on the economy.
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1 comment:
How can there be a bust, there never was a bubble, right?
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