As reported by the OC Register, June 21, 2011

At a recently concluded real estate writers conference in San Antonio, most analysts conclude that it is going to take a long time to recover from this housing market and home prices could continue to drop into 2013.

“Right now we are in a tremendous flux due to this overhang (of homes facing foreclosure),” said Jed Smith, director of quantitative research for the National Association of Realtors. “It’s going to take about four years.”

Meanwhile, with 1.2 million to 2.2 million U.S. homeowners becoming renters, apartment vacancies are going down and rents are expected to rise between 3.5% to 5.1% this year.

None of the experts at the National Association of Real Estate Writers’ annual conference in San Antonio, Texas, expected the housing picture to brighten until employment levels improve significantly. Some other projections made at the National Association of Real Estate Editors gathering: 

Stan Humphries, the chief economist for the home-valuation website Zillow.com:

  • Projected that U.S. home values will continue falling on an annual basis until late 2012 or 2013: “We do foresee home price declines.”
  • Zillow figures show that home values in Orange County and across the nation now are lower than during the previous bottom in the winter of 2009. For example, Zillow’s index value for Orange County hit bottom at $467,000 in March of 2009. It’s now at $454,000.
  • U.S. home prices are projected to continue falling on an annual basis until late 2012 or 2013.
  • Homebuyer tax credits, which were meant to jump-start the housing market, could be having the opposite effect. At a cost of $15 billion to $20 billion, tax credits increased home sales temporarily, only to have them drop once the credits expired.
  • Meanwhile, most forecasters predict that rental rates in the nation are projected to climb 3.5% to 4.5% this year.

 

Smith, the NAR researcher:

  • Expect a very slow recovery, partly because of financial issues, but mostly due to high unemployment levels.
  • “We need jobs,” he said.

Mark Dotzour, the chief economist for the Real Estate Center at Texas A & M University:

  • “We’re not in a double-dip (housing recession) in my mind. We just never hit bottom in the first place,” he said.
  • He added: “Nobody wants to buy a house. … Everybody knows there’s this huge shadow inventory (of homes in foreclosure). At some point, the market’s going to start to clear. The foreclosed properties will be start to be sold.”

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