If you ever wanted to buy a home, you probably won’t find homes any cheaper than they are now. Since 2006, housing prices are down 34%, asupply-demand adjustment to the housing bubble. It is likely though that the prices won’t stay this low forever and that the housing market could bottom out. With declining foreclosures, continuing job growth and an increase in construction could signal that the housing slump has flattened out. Some economists such as Stuart Hoffman (chief economist for PNC financial) believe that the housing market will flatten in the third quarter and start climbing next year. Other economists are even more optimistic like Jed Kolko (economist for Trulia’s) who believe that home prices will increase during the summer.
Even though as stated earlier, the low housing prices combined with the low interest rates won’t stay low forever, that doesn’t mean that the rosy forecasts of the economist forementioned will come true. This is especially true if the recovery fizzles and the economy becomes stagnant. Since the Great Recession began, many economists have ventured a guess as to when the housing market will bottom out, some said in the summer of 2009, others said in 2010, 2011 etc. The fact of the matter remains is that as long as the U.S. economy is weak (weak being used subjective here), consumers are unsure if they’ll keep their jobs and the mortgage debt is not cleared out, there is no clear indication that the housing prices will raise in the coming year. What is certain however is that buying a home is cheaper than ever and in fact in many areas around the country, buying is cheaper than renting.