I mostly disagree, and that’s coming from someone who’s about to close on a new home.
Yes, interest rates are likely to go up in anticipation of inflation.
But the downward pressure on prices will be increasing in the coming years, in my opinion: a huge “shadow inventory” of underwater homes, not yet foreclosed but doomed to that result, will hit the market in 2010-12 as “teaser rates” continue to reset upward.
With all of that add SUPPLY hitting the market, and with DEMAND unlikely to increase overall due to the job situation, I fail to see how PRICE isn’t going to keep falling for a few more years. Will there be updrafts, “suckers rallies”? Sure. But if my life situation were different, I’d wait.
I will agree with you about the additional inventory. Why would the banks release them any faster than they are now?
I too agree we have a large inventory, but I also see some longer term problems on the horizon. Us baby boomers are probably not going to aleviate to oversupply, as most of us are no longer in home-buying mode. The other thing we’re gonna do is add to the inventory as we die off or go to the old folks homes. Don’t forget we are a hugh population spike traveling thru time.
It depends where your at. If ya go into the more desirable areas, you’ll see very little inventory available for sale.
Crappy areas = lots of inventory.