An interesting post on Calculated Risk this morning points out a few notable near-term home price predictions:
Housing consultant Ivy Zelman via the New York Times:
…home prices are going back down.
Moody’s chief economist Mark Zandi via Bloomberg:
I think we’re going to see another leg down.
And Goldman Sachs chief economist Jan Hatzius:
Our current working assumption is a 5%-10% drop in home prices through the middle of 2010.
Note that these forecasts are all nationwide. In most parts of the country home prices began falling a good year before Seattle, and had fallen further than Seattle before the inefficient, expensive, and economically stupid tax credit put the brakes on the full return to affordable housing.
If nationwide average home prices do indeed drop another 5-10% in the coming year, I suspect that Seattle area home prices will probably be down 10-15%.
Oh and by the way, in case you didn’t see the news; as expected, a couple weeks ago Congress passed an extension and expansion of the idiotic tax credit. The move was tacked onto a completely unrelated extension of unemployment benefits to assure that no congressman could vote against it (crap like that should be illegal), and is estimated to cost another $10 billion that we don’t have (so you can expect it to cost at least $20 billion). Oh, and just for kicks they threw $33 billion in tax refunds to homebuilders into the bill, too. Because the national debt just wasn’t big enough already. Super!