Saturday, February 14, 2009

When Will Prices Bottom Out?

Housing prices will hit bottom in the fourth quarter of 2009, predicts Moody’s in a new report.

"Despite the darkening national economic outlook and the weak conditions in the housing market, some positive signs give hope that a bottom in the housing market is coming into view," the report says.

On average, home prices will decline 36 percent from the peak in the first quarter of 2006, the report says.

By the end of the housing downturn, nearly 62 percent of the nation's 381 metropolitan areas will have experienced double-digit-percent declines in house prices, peak-to-trough, says the report.

The declines will exceed 20 percent in about 100 metro areas, according to the report, scheduled to be discussed in a Webcast on Thursday.

The recovery will be “lackluster,” the report continues.

"A number of uncertainties in both the housing and economic outlooks remain, and the risks tilt to the downside," says Moody’s Chief Economist, Mark Zandi.

Source: The Wall Street Journal, James R. Hagerty (02/06/09)

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