Is the arrow still pointing down for the housing industry?

Filed in archive education on July 15, 2009

It seems as if we've all been waiting since 2007 for the housing market to hit its bottom. I know I'm tired of watching my home's value continually go down. I'm also tired of all those "For Sale" signs still dotting the lawns in my neighborhood.

I've seen a few predictions about when the housing market will finally hit bottom. The bad news is that, according to this story by Reuters, while the hoped-for bottoming out of the real estate industry may be in sight, a recovery of the housing market will probably take at least 18 months.

Yes, that's a year-and-a-half. Personally, I don't know if I can take 18 more months of fretting about rising foreclosures, homes that won't sell and mortgage delinquencies. It's all too darn depressing.

The Reuters story, which cited a report by Fitch Ratings, did have a bit of good news. It seems that pent-up demand for new housing is fairly strong. The spring home-selling season was a big improvement over the winter doldrums through which the housing industry suffered, Fitch Ratings reported.

Fitch also said, though, that weakness in the housing market will probably continue through most, if not all, of 2009. That's not what anyone wanted to hear.

I think back to December of 2008. There were hopeful predictions that we'd start to see a housing recovery in 2009. Some real estate professionals might argue that this has happened, that the rising home sales in the spring signal the start of a housing comeback.

But you have to remember, sellers unloaded their homes at bargain prices in the spring. And even though the number of sales were higher in March, April and May than they were in the winter months, they were still far lower than they were just one year earlier. Besides, sales always pick up in March, April and May. There's really nothing unusual about that, despite what the real estate agents want you to believe.

I'm trying to be hopeful here. But I'm seeing a few too many of those dang "For Sale" signs in my neighborhood to be too optimistic.