Dr. Lawrence Yun says the housing market in the U.S. and in Wisconsin bottomed out in the third quarter and will improve modestly in 2010.
Dr. Lawrence Yun, the senior vice president and chief economist for the National Association of Realtors, says the housing market in the U.S. and in Wisconsin bottomed out in the third quarter and will improve modestly in 2010.
“I think the bottom of the housing market has already occurred,” he said. “Prices are lower compared to a year ago, but things have stabilized. With the homebuyer tax credit, the market should be even stronger in the spring buying season.”
Yun, who spoke recently at a Wisconsin Realtors Association event in Waukesha, predicts the national and Milwaukee-area housing markets will have a modest 2 to 4 percent increase in prices next year as the economy slowly recovers.
“Consumers should not anticipate double digit appreciation anytime soon,” Yun said. “If that occurred, it would be an anomaly.”
After the housing bubble burst a massive oversupply of homes created a buyers market which caused many builders to stop building and many homeowners to hang on to their current homes instead of selling. That resulted in a significant drop in homes listed for sale, which has helped the market recover, Yun said. As sales are picking up inventory levels are now getting closer to normal, which would be a 6-month supply. The current inventory level is about a n 8-month supply, which is an improvement from the 11-monthy supply that was on the market at the beginning of the year.