Six years since the start of the greatest housing collapse since the Great Depression, one doesn't have to look very far to see signs of a recovery. Nationally, home prices are rising after more than a 30% drop since mid-2006. More good news arrived Tuesday, as the Standard & Poor's/Case-Shiller home price index reported third quarter prices were up 3.6% from a year ago and September's 20-city index reached its highest level in two years. Foreclosures have slowed in most of the country after having decimated hundreds of U.S. cities. Rather than being a drag on the U.S. economy, housing is now seen as a contributor to growth.
"With six months of consistently rising home prices, it is safe to say that we are now in the midst of a recovery in the housing market," said David Blitzer, chairman of the index committee at S&P.
"It's almost a ZIP code by ZIP code recovery," says Stan Humphries, Zillow chief economist.
What's better now?
Zillow's data show that 183 of 252 markets nationwide hit bottom in the third quarter, after years of largely falling, and probably won't fall more. Prices were still falling in the other 69 markets, Zillow says. Yet on a national basis, 140 economists recently surveyed by Zillow predicted home prices would rise an average 15.2% from the end of last year through 2016, or from 2.3% to 3.4% a year.
More-bullish economists, including John Burns of John Burns Real Estate Consulting, see prices rising 5% to 7% a year through 2016. If so, they'd far exceed the average 3.65% a year growth in prices that defined the national housing market from 1988 to 2000 -- before the housing bubble started to form, Zillow says.
For entire article search Julie Schmit, USA TODAY