Foreclosures may “Stall a Housing Recovery”

A survey of 109 economists released this week by Zillow Inc. forecasts that U.S. home prices may fall further under the weight of foreclosures, bouncing back no sooner than 2013 even with mortgage rates at historic lows.

Zillow researchers say U.S. home values probably registered their smallest drop in four years in 2011, with prices expected to hit bottom in late 2012 or the first quarter of 2013 and begin rising by 3 percent a year through 2016.

“Negative equity, unemployment, and low consumer confidence remain the key factors delaying a true recovery,” Zillow Chief Economist Stan Humphries says.

 Source: “Foreclosures Weighing on Prices May Push Housing Rebound to 2013,” Bloomberg (Dec. 22, 2011)

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