by qrono
20. November 2009 12:08
In a lead story, the Wall Street Journal (WSJ) paints a dismal picture of the housing market in 2010. Uncertainty over the extension of a home-buyer tax credit sent new-home starts in October crashing down a full 10.6% from September, and starts of single-family houses fell 6.8%. That's the lowest level since April, the Commerce Department said. This news suggests that foreclosures are not only going to keep rolling in, but that they may actually increase. Richard Dugas, chief executive of Pulte Homes Inc., the nation's largest home builder, warned investors: "As we look out to 2010, we are expecting difficult conditions to continue." Wednesday's data prompted some economists to revise their fourth-quarter forecasts down slightly. Macroeconomic Advisers moved its GDP estimate down to 3% from 3.2% and Nomura Securities predicts 3.4% growth, down from 3.6%. The data adds to the suggestion "that the recovery is a little bit rickety," said Zach Pandl, an economist from Nomura. Given that 3.4% of U.S. households -- or about 1.9 million homeowners -- are 120 days or more overdue on their payments, and that millions of homes are expected to go through foreclosure over the next few years, adding to supply, it's a fair bet that foreclosure problem won't be gone anytime soon.
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