September 20, 2010
The Washington Post told readers that this week’s reports on home sales are expected to show increases which it describes as “a sign the U.S. real estate market is stabilizing.” It’s not clear what the Post means by stabilizing.
While the number of homes being sold each month is likely to remain reasonably even in the months ahead, prices are likely to resume their fall. They still have another 15-20 percent to drop in order for the bubble to fully deflate and prices to return to their long-term trend.
It would be helpful if the Post did not rely exclusively on experts who completely missed the $8 trillion housing bubble. During the years the bubble was expanding the Post’s main source on the housing market was David Lereah, the chief economist of the National Association of Realtors, and the author of Why the Housing Boom Will Not Bust and How You Can Profit from It.
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