Real Estate Update

The economy has been severely wounded and it didn’t happen overnight. Looking forward, the prognosis is encouraging, but it will be a slow healing process.

Gazing into their crystal balls, economic experts see a better housing and mortgage market coming in 2011.

According to an article in the Chicago Journal–Economists clearly see low home-loan interest rates, rebounding home prices and more job creation leading to a gradual recovery in the second half of the year, according to a new year-end economic outlook by Freddie Mac.

“As in the past, key macroeconomic drivers of the economy — such as income growth, unemployment rate, and inflation — will affect the performance of the housing and mortgage markets in 2011,” said Frank Nothaft, vice president and chief economist of Freddie Mac.

“With fiscal policy supporting aggregate demand for goods and services and an accommodative monetary policy providing low interest rates and ample liquidity to capital markets, the economic recovery should accelerate gradually over the year, with the second half of 2011 exhibiting more growth and job creation than the early part of the year,” Nothaft said. Read more…

According to an Article by NICK TIMIRAOS And JUSTIN LAHART  in the Wall Street Journal online,

Home Prices Slide Despite Discovery

Home prices fell to new lows in 11 cities in December, the latest sign that the weak housing sector remains a soft spot in the U.S. economy.

Across 20 major metropolitan areas, home prices fell 1% in December from November, according to the S&P/Case-Shiller home-price index released Tuesday. The index has declined for five consecutive months, all but erasing the gains in home prices since the recession ended in June 2009.

The feeble housing report comes as other indicators suggest that the economy is gaining ground. Another report Tuesday showed Americans’ attitudes on the economy growing more upbeat.  Click here to see ‘Housing Barometer’ from December 2010.

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