Bailout

"The Composite, which was reasonably flat in June, showed a marked decrease in July, falling more than half a percentage point (0.63%)."

Moody?s housing economist Celia Chen has released a forecast of housing that is pretty dire. If the U.S. enters a doubledip recession, writes Chen, home prices could fall another 20% before stabilizing in early 2012. That compares to a baseline forecast that calls for another 5% decline in home prices and a bottom early next year. Chen puts the odds of a near?term double?dip at one in four. As observers of the actual housing market, while we cannot say these numbers are right, we certainly support Chen?s concern. However, we think the order of events will be reversed: it is our belief that housing prices will decrease in the autumn, perhaps precipitously, and that may cause a second dip in the U.S. economy.

Other reports of interest ...

Full post as published by Calculated Risk on August 17, 2010 (boomark / email).