Calculated Risk: Some Housing Forecasts
"Now there is a growing consensus that new home sales and housing starts will increase in 2012. I think a small increase is likely, even with the large number of distressed homes, and I will be writing about the reasons soon."
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I hear that from various sources. Some developers are making rumbles about getting back in action. But I have to think they, and the banks that make construction loans, will be looking at market conditions very closely, especially the supply of foreclosed homes that are put up for sale, many of which are new or nearly new and would drive down asking prices for newly constructed homes. The unknown variables are (1) the number of foreclosures and other surrenders of ownership to banks, and (2) the number of those properties that are dumped on the market in 2012. Courts, foreclosure defense lawyers, and banks all have some direct or indirect control over the supply end of the equation.
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