When will housing hit bottom?
February 5th, 2008, 11:11 am · Post a Comment · posted by mistywilliams
It’s a question no one can answer but everyone likes to guess at.
Many Valley experts I’ve talked with in recent months believe prices could bottom out later this year or in 2009 but that a full market recovery could take up to five years.
The latest forecast comes from Metrostudy, a consulting firm that tracks the national housing market. Builders are offloading excess homes, interest rates are near historic lows and prices could stabilize by mid-year, according to a report released this week by the research company.
“Home prices in many markets are as low today as they are likely to be for the next decade,” Metrostudy President Mike Inselmann said in a statement.
In the Valley, the number of homes started in the fourth quarter 2007 was down 32 percent compared with a year ago, the report shows. Sales were down 23 percent.
“The decline in starts is actually a positive for Phoenix, since builders need to deal with the excess inventory before bringing more homes onto the market,” said Ben Sage, director of the company’s Arizona division.
Despite a heavier focus on getting rid of inventory homes, the number of vacant finished homes rose in the final months of 2007 for the first time in three quarters to 9,875 units, according to Metrostudy.
Until supply comes into balance with demand for new and existing homes, experts say, the market will continue to suffer.
