"The national media, seduced by a few vocal but misinformed
analysts, have been painting the U.S. housing markets as one huge
national market in the clutches of a meltdown, even though the facts
paint a very different picture," according to NAR.
NAR Chief Economist Lawrence Yun reported that other national
sales downturns in the last 30 years were spurred by broad economic
problems. This year, by contrast, economic fundamentals remain solid,
with the U.S. gross domestic product expected to grow by a respectable 2
percent, supported by 2 million job gains in the last two years and
continuing low interest rates.
Yun said 2007 existing-home sales will exceed 5.5 million, close
to the level in 2002, a record-setting year. At the same time, home
prices remain near record highs despite drops in a few markets.
Yun noted that much of the cooling in real estate markets over
the last year is attributable to risky subprime loans. A tightening in
credit standards, though much needed, has made it harder for some
borrowers to close on their financing in a timely manner.
[SOURCE: NAR]
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