Goodbye, finally, to falling home prices?
A new Reuters poll of economists in fact seems to suggest just that.
The overall consensus is that prices will fall another 3 percent before bottoming out and then rebounding next year. That would mark a 33 percent decline from the market’s peak in 2006.
That’s likely welcome news for many homeowners and would-be sellers, but not necessarily anything to cheer about for prospective buyers, especially here in the Boston area.
Not just a national trend, there are growing signs locally as well that the end may be in sight to the seemingly endless series of home price declines.
But the correction has been less dramatic here than in many parts of the country, especially Sunbelt cities that were flooded with new homes and condos and now hammered with foreclosures.
That, of course, still leaves a Boston market that is still pretty expensive for most people, even if prices have retreated from boom-time levels.
But let’s get back to the housing poll, which makes a sure-to-be-debated connection between the battered real estate market and the economy.
Conventional wisdom has it that the economy is being held hostage by our housing market woes. After all, it was the implosion in the housing market that helped trigger the worst recession in decades.
However, the economists polled by Reuters contend the overall economy can make a comeback, even if the housing market does not. In particular, home prices don’t need to rebound for this to happen, according to the survey.
Overall, 13 economists believe that housing markets have already hit bottom, while 27 argue that the low point will be reached within a year. One economist argues it could take up to two years.
That said, the survey hardly found economists predicting a return to the boom years, with record foreclosure, high unemployment and massive amounts of bank owned property all putting downward pressure on the housing market.
