Is the Market Coming Back...Or, "Stabilizing" for a Very Long Time?
Two articles caught my attention this morning including one from Mr. Steve Harney's "Keeping Current Matters" Blog and an article by well respected Yale economics professor, Mr. Robert Shiller of the Case-Shiller Index. Mr. Harney's post was entitled, "Further Proof the Real Estate Market is Coming Back" and can be read HERE. Mr. Shiller's comments were reported in the Chicago Tribune on April 24th and can be read HERE.
The KCM Blog reports, "Last week, the National Association of Realtors (NAR) released their Pending Sales Report which showed that contracted sales were 12.8% higher than the same month last year and higher than any time since sales were impacted by the Homebuyers' Credit back in April of 2010. The index stood at 101.4 which represents a level that is historically healthy."
The Pending Sales Report is welcomed news. However, before we get excited that indications are showing coming appreciation Mr. Shiller predicts that the housing market "is likely to remain weak and may take a generation or more to rebound." His reasoning consists of "a weak labor market, high gas prices and a general sense of unease among consumers was out weighing low mortgage rates and would likely keep a lid on prices for the foreseeable future."
There are more and more headlines reporting on the housing market showing signs of improvement and stabilization. As things stand at the present I can't help but to think Mr. Shiller is spot on in predicting stabilization but no great deal of appreciation for the foreseeable future. Perhaps this means Americans will return to purchasing homes as a place to raise a family, host family and friends, to personally enjoy, etc. verses purchasing a home to be a cash cow.