Realtor Magazine's Article titled Residential Market Outlook: Virtuous or Vicious? by Robert Freedman depicts a positive story, if all goes well, that is. And if you look at the current housing data, it looks that way.
"Yun is forecasting 5.2 million existing-home sales in 2011, up from 4.8 million last year. He also expects modest improvement in prices—a rise of about 1 percent this year on a national basis. That would be the first in what Yun says will be a series of small but steady gains in the years ahead that will eventually bring home sales back to a period of normalcy."
"At the root of these gains is continuing improvement in the overall economy. Yun is estimating modest 2.5 percent growth in the country’s gross domestic product in each of the next two years, job gains of about 1.5 million in the same time frame, and a slowly improving jobless rate, which he projects will dip from a stubbornly high 9.6 percent in the latter part of 2010 to a better but still-high 8 percent in 2012.
This is what Yun calls the "virtuous cycle" that residential real estate started entering a few months after the home buyer tax credit ended in the middle of 2010. At that time, home sales took a big hit, dropping 27 percent in July. But in August, sales picked up again, under their own steam, and have been gaining ever since without the aid of subsidy."
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