Housing May Turn the Corner in 2012

CoreLogic’s chief economist Mark Fleming says housing statistics and the duration of the downturn to date indicate 2012 may be the year the housing market begins to turn the corner.

In the first release of CoreLogic’s new MarketPulse newsletter Wednesday, Fleming explained his rationale for such an assessment.

He notes that housing is an industry with long business cycles. Regional housing recessions have typically taken anywhere from three to five years to find their bottom, and Fleming says the national housing recession has behaved similarly in that it has bounced along a bottom for the past two years.

Fleming points out that housing affordability is rising dramatically due to a combination of home price deflation and rock-bottom mortgage rates. In fact, he says, after adjusting for inflation, this has been a “lost decade” for housing as prices are the same as at the beginning of the millennium.

“The time is right in 2012 for prices to begin growing again,” Fleming said, “and housing affordability will put a floor under any further significant declines.”

Fleming says he will be watching the spring and summer buying season closely for positive signs of demand.

He points out that households are paying off their debts and at the same time accessing credit more easily, with some even adding Home Equity Lines of Credit in the third quarter of last year – the first such movement for these second-lien mortgage products since the financial crisis began.

Fleming cites a quarterly survey by the New York Federal Reserve Bank, which shows total household debt continues to decline. At the same time, consumer sentiment rebounded strongly in the latter part of 2011, posting a six-month high in December – an indication that consumers’ confidence in the strength of the economy is growing, according to Fleming.

Most housing statistics basically moved sideways in the latter part of 2011, but Fleming finds several positives in the numbers. Although market indicators are coming off of very low levels, he notes that both existing-home sales and single-family housing starts have begun to increase, homebuilder confidence is improving, and affordability is at an all-time high.

Putting all of these statistics together suggests that while there is a very long way to go, the housing market is likely to sustain these upward movements in 2012, according to Fleming.

“While we cannot say with a high degree of certainty what 2012 has in store for us, indications based on the latter part of 2011 are that both the broad economy and the housing market are moving toward positive growth in 2012,” Fleming said.

He concedes that some impediments do exist, including slower global economic growth, a recession in Europe, and fiscal and political uncertainty in the United States.

But Fleming says when you look at the big picture, “we are bullish on the prospect of improving economic performance in 2012 from 2011.”



DSNews.com

 

About Ady Simion (Realtor and Public Notary)

Ady Simion was named in the Top 1% of all agents for NRT LLC a subsidiary of Realogy that operates a variety of real estate offices under brands such as Coldwell Banker, Sotheby's International Realty, Century 21, The Corcoran Group, and the technology-based brokerages ZipRealty and Climb Real Estate. NRT has 787 offices and 47,000 sales associates. Selling and buying property can be very stressful but with the right agent it can be profitable and a fun experience. Ady is also a Notary Public and being a people person he wants to help negotiate for his clients making their transactions as smooth as possible. Ady’s goals are simple: He wants to be the best source of information on the Los Angeles area Real Estate market, as he assists clients through each transaction with care and professionalism. He is proud of his large referral base of clients who have placed their trust in him over the years. Why him, when there are so many good people out there?!?! • Sellers will have their property exposed to the largest team of sales professionals in the world by far. Coldwell Banker Agents sale more homes than anyone else. • Buyers will have the opportunity to view more properties exclusively. • And most importantly when you hire him you get a whole team working for you not just “only one person”. Ady Simion started his Professional Career as an Insurance Agent, and then mastered the Mortgage Industry focusing on helping buyers and sellers achieve their life dreams. He now is an Agent with the Largest Residential Real Estate Company in the nation and the world, Coldwell Banker, at the Pasadena office which is the leader in the areas in which he specializes. After finishing College Ady has consistently been a Top Producer in every office/business he worked at. He speaks English, Romanian and Spanish. Real Estate is constantly changing and working with an agent that has been involved in the Real Estate buying/selling process most of his life is always beneficial for clients. Call, text or e-mail him or just stop by to say Hi and ask any real estate questions you may have.

Posted on January 25, 2012, in enter blog category and tagged . Bookmark the permalink. Leave a comment.

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