NAHB: House values to fall 10 to 15 percent

From Inman News:

2008 not so great, says builders’ economist

Single-family housing starts are expected to plummet 29.3 percent this year compared to 2006, and to drop another 23.6 percent in 2008, National Association of Home Builders chief economist David Seiders said in a forecast report Thursday.

Seiders expects house values to fall about 10 to 15 percent from the peak of the boom to the low point in the downturn, with further price erosion next year. He said the price declines should ease some housing-affordability problems.

“This year has turned out to be much weaker than I had expected a year ago,” he said, and he blamed the “progressive meltdown of the housing finance system” for the housing market’s unexpected rate of decline.

“The probability of recession has probably increased fairly significantly in a short period of time,” and Seiders said he estimates a 40 percent chance that the economy will sink into recession in the next two quarters.

“We really are right now in a danger zone in terms of overall economic activity. I think it’s fair to say that the overall economy is slowing pretty dramatically in the fourth quarter.”

Single-family housing starts are projected to drop about 53.7 percent from an annual peak of 1.72 million in 2005 to an anticipated low of 796,000 in 2008 before recovering to 885,000 starts in 2009.

Single-family new-home sales peaked at a record 1.28 million in 2005 and are expected to bottom out at 741,000 in 2008, and then to rise to 838,000 in 2009.

New-home sales dropped 18 percent from 2005 to 2006, and are projected to fall 24.4 percent this year compared to last, drop 6.6 percent in 2008 and rise 13.1 in 2009.

And the builders’ group expects single-family sales of previously owned homes to drop 13.3 percent this year compared to 2006, to a total of 4.95 million. That follows a 7.7 percent year-over-year drop in 2006. Seiders also expects a 13.4 percent year-over-year drop in 2008 and an 8.4 percent rise in single-family resale home sales in 2009.

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3 Responses to NAHB: House values to fall 10 to 15 percent

  1. anonymous says:

    Now I’ll tell you about the attitude of home sellers ,my neighbor wanted to sell her house this year but had kept reading about how bad the market is .She now reads where where it is suppose to bottom some times in 2008 ,so her thoughts are wait till fall 2008 and list her home ,I ask what price would sell ,her answer about 10% more than she would ask now ((900k) which is about 30% to high anyway. she thinks that the end of the slump will bring much higher prices !

  2. 3b says:

    She is an idiot.

  3. anonymous says:

    2 bedroom 1 bath and it sold for 1.5 mil ??? can’t be real….

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