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Ratings Agency Moody's Predicts Housing Market Bottom This Year
Moody’s has reported an interesting prediction about the nation’s housing market prior to the Thursday release of its new report on housing, Housing In Crisis: When Will Metro Markets Recover? One of the report’s key predictions is that the nation’s housing prices will finally reach the bottom of their precipitous decline by the end of this year.
While this is certainly a welcome prediction, keep in mind that the ratings agencies have suffered a blow to their credibility over the past year by over-rating the subprime mortgage-backed assets that catalyzed the current financial crisis. That said, seeing the real estate market bottom at the end of 2009 seems pretty realistic. By that time, prices will have been on the decline for over three years, there will be a lot of pent-up demand for housing, and much of the macroeconomic uncertainty currently keeping people on the sidelines will probably have been worked through.
Aside from their biggest finding, Moody’s has a few more predictions:- The national Case-Shiller house price index will decline by another 11 percent from the fourth quarter of last year for a total peak-to-trough decline of 36 percent.
- By the end of this unprecedented downturn, home prices will have declined by double digits in nearly 62 percent of the nation’s 381 metro areas. In about 10 percent of those metro areas, the price declines will exceed 30 percent.
This article originally published at https://dc.urbanturf.com/articles/blog/ratings_agency_moodys_predicts_housing_market_bottom_this_year/509.
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