The latest housing data indicate a downward trend in housing inventory. Nonetheless, persistent unemployment and the relatively large number of houses in foreclosure or close to being foreclosed spell further trouble.
UNEMPLOYMENT & FORECLOSURE
Needless to say, joblessness and mortgage woes are still bedeviling the housing market. Without people working, we will see more homeowners fall into the vicious cycle of foreclosure. With unemployment in the back of the mind of many, demand for homes will consistently drop and with it the house prices will take a hit.
RELATIVE PRICE STABILIZATION
However, we could still be somewhat hopeful. According to S&P/Case-Shiller 20 composite index in November prices edged up 0.2% from October on a seasonally adjusted basis. It was down 5.3% from a year earlier and was about 29% below the peak set in 2006.
MORE FORECLOSURES DOWN THE ROAD
According to data from LPS Applied Analytics, lenders have not even started foreclosure procedures for about 2.5 million households that are 90 days or more behind on their payments.
It is noteworthy, although there has been relatively some good news in the housing market, the commercial real estate market and market for higher-priced homes are still hurting.