Hovnanian CEO Says Housing's Biggest Problem is Psychological
Hovnanian Enterprises Chief Executive Ara Hovnanian told CNBC Friday that the housing market's biggest problem is pyschological.
"It's a psychological problem right now, more than anything else," Hovnanian said on CNBC's "Squawk Box." "Job growth is good. Interest rates are still really, really good. Demographics are good so it will come around."
"We've been through these cycles many, many times before," he continued. "When it's bad everybody thinks it's going to be bad forever, and that’s not the case. It is going to come around."
Hovnanian doesn't expect a rapid recovery in the immediate future because the housing market remains "challenging."
He said the public home builders are a good barometer of the market's health.
"The group's sales have been down probably 20% to 25%, so (housing) starts should follow that kind of number, compared to last year," Hovnanian said.
Although Hovnanian expects credit-challenged would-be homebuyers are having a harder time getting a mortgage, that's only a small segment of the market, he said. For others, "it's business as usual."
"My guess is things will slowly start to stabilize soon…but stabilization doesn't mean recovery," he said.