Housing Shows Stablization, Led By Strong Demand

AP

The worst is over for the housing market, as low interest rates and strong demand are bringing stabilization to the pressured sector, said Patrick Lashinsky, President and CEO of ZipRealty.

"We've gotten supply better under control, new homebuilders aren't putting as many homes on, we've got demand in a good place, [and] interest rates are in a good position," Lashinsky told CNBC.

Home listings fell month over month in July, resulting from an increase in buyers, and from sellers taking their homes off the market because of consecutive price reductions. Inventory is down in several major cities, including a 6.5 percent decrease in Las Vegas and a 4.7 percent increase in Orlando, Lashinsky said. Both cities were among the hardest hit by the housing downturn.

Video: ZipRealty CEO Patrick Lashinsky discusses what appears to be stabilization in the housing market.

Although this will likely create a shadow inventory — an increased supply of for sale homes down the line — it won't be significant enough to cause another housing downturn, Lashinsky said.

"People are waiting to get to a price point and a place where they feel comfortable selling their homes, and that's going to be over a period of time," he said. "It's not going to be a switch that gets flipped and everyone just decides to put their homes on the market."

Lashinsky predicts there will be one more wave of foreclosures in the next three to five months, but the inventory will quickly be absorbed by demand.

Last week, ZipRealty announced that fewer home sellers reduced their asking prices in July, but prices on more than 40 percent of homes had been cut at least once.