According to this Reuters story, we have still not hit bottom in housing prices.
Mark Zandi, chief economist at Moody’s Economy.com in West Chester, Pennsylvania, said in an interview with Reuters home prices will resume their decline by early next year as foreclosure sales pick up again.
We recently have experienced solid price increases, but they were due in part to lenders attempting loan modifications and some government incentives. The Obama administration just renewed the $8000 tax credit for first time home buyers. They also established now guidelines for short sales with the intention of making them happen more smoothly.
Zandi said about 25 percent of single-family homes with mortgages have negative equity.
“With so many homeowners so deeply underwater and unemployment very high and on the rise, the foreclosure crisis will continue putting more pressure on home prices,” he said.
The U.S. Labor Department said the unemployment rate reached a 26-1/2-year high of 10.2 percent in October. November’s unemployment rate in November will be announced on Friday.
The new numbers were 10.0%, but since it was a short work week, the numbers are questionable.