Is The Real Estate Market Near The Bottom?
Jon Lansner certainly thinks so. His recent blog gives several indicators:
- OC home prices rose in June
- Increased sales rate
- Supply down
- And more
I’m not so optimistic. I don’t want to be the naysayer, but the number of low interest rates/arms set to expire from 2009-2011 and the home values certainly not rebounding in time to refinance makes me nervous that this is just the bottom of round I. I don’t think Round II will be quite as bad, but it certainly won’t help. That said, I think we still have some time before crying “bottom”.
CNNMoney.com reports that they think that there are several factors indicating the market has not yet hit rock bottom.
The factors that are weighing on the housing market remain in place – weak consumer confidence, a weak labor market and rising mortgage rates – so there are some strong fundamental headwinds still weighing on the market,” said Robert Dye, senior economist at PNC Financial Services Group.
“We are hoping for a bottom, but we are not expecting any significant rebound from that bottom until the labor market and consumer confidence starts to improve,” he added.
I have to agree there are too many unknowns and weaknesses in the market. Until we see some more strength from the consumer perspective, as well as a well-laid plan to account for the millions of homes that are doomed for foreclosure when the arms and interest rates rise in the next few years, things aren’t going to get much better.
