The imbalance in housing demand and inventories will continue to keep home prices down for some time, said Michelle Meyer, economist at Barclays Capital, and Karen Weaver, analyst at Deutsche Bank.
Meyer said although there are signs that housing starts are near the bottom, she doesn’t expect foreclosures to peak until the second half of next year.
“We don’t think foreclosures have peaked yet,” Meyer told CNBC. “We think this is going to be a slow, long process.”
In the meantime, Weaver said there are at least 4 to 5 years' worth of excess supply in houses, which will make the housing market hard to stabilize.
“Rising unemployment, general concern, and lack of confidence for the future is causing people to delay housing purchases even with those attractive prices in many areas,” said Weaver.
She said affordability is usually not the problem for homebuyers, but worries about further declining prices and job losses are the main concerns that hinder consumers from purchasing new homes.
Disclosure:
No immediate information was available for Meyer, Weaver or their respective companies.
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