Over the past several months, existing home sales have seen an uptick, but according to a Reuters poll which analyzed 26 leading economists’ predictions, “economists now expect home prices will fall 2.3% in 2011, and then begin a slight recovery in 2012.”
By the end of the year, the total price drop from the peak of the housing market in 2006 will be 35%, they said.
Reasons cited include a rise in “distressed” home sales and “depressed” prices and a doubling in the amount of time it takes to close a foreclosure home.
The economists also noted that this year, there is no tax credit to prop up buyer activity.
“Price expectations are probably more important than foreclosures at this time,” said Donald Ratajczak, Morgan Keegan’s Atlanta-based consulting economist.
According to Reuters, Ratazjczan “noted that prices are rising in San Diego, where foreclosures make up a big portion of sales, and falling in Atlanta, where foreclosures are below average. The difference, he said, is that San Diego buyers see foreclosures as an opportunity, and Atlanta buyers see them as a problem.”
The silver lining? The poll indicates that interest rates will not harm the housing sector.
Rick Cordisco via Facebook
March 3, 2011 at 8:06 am
The Economists really like to manipulate activity don’t they?
BawldGuy
March 3, 2011 at 12:47 pm
What with the distressed sales in SD continuing, one wonders how in the world, if it continues most/all of this year, how the median price would be higher at the end of the year than when it began. When the smoke clears, I’ll be mildly surprised if SD prices rose.
Intown Atlanta Real Estate
March 4, 2011 at 10:52 am
The last paragraph makes no sense to me. Prices are UP where there are lots of foreclosures, and DOWN where there are fewer? And buyers see foreclosures as a problem?? That’s not our experience. I also question the statement that foreclosures are below average in Atlanta. That’s not what I’m seeing and reading. https://www.bizjournals.com/atlanta/news/2011/01/27/atlanta-foreclosures-up-21-in-2010.html
https://www.bizjournals.com/atlanta/news/2011/02/10/georgia-foreclosures-up-13-in-january.html
MH for Movoto
March 4, 2011 at 3:01 pm
Hmmm….. the diff in attitude toward foreclosures is interesting….. I mean, it makes sense. i just wonder what social/economic expectations inform peoples’ opinions…. and whether those opinions follow any sort of consistent geographic trend?