Housing Won’t Collapse – Oh good, I feel better now…..

The article by Housingwire.com has some good information in it but also some big IF’s in it…

Housing values could significantly recover in the spring of 2010 as low prices attract a blend of owner-occupiers and investors. Heated bidding pushes up prices at foreclosure auctions, and the supply of new and existing homes is declining, according to the report.

They could significantly recover, but I don’t see how this report makes a solid claim that they will.

“Thanks to federal bailout money and a general improvement in their financial health, banks have been relieved of the urgent need to liquidate their assets. As a result, lenders and government entities like Fannie Mae and the FDIC have been able to curtail sales to raise prices and avoid recording losses on properties,” according to the report.

Okay, but this fails to address a couple of things:  1) The Federal Bailout Money is ending.  Don’t know for sure when but it is.   2) Have the banks been relieved of an urgent need to liquidate assets or are they attempting to make it look better than it really is by dragging the process out further and further?   3) Avoid recording losses or put off the losses and kick the can down the road?

If the government and the banks can effectively solve the puzzle of mitigating foreclosures, Radar Logic says that home values could even go up in 2010.

IF they can solve the puzzle and we all know how well that has happened so far.

I’m not predicting a collapse in 2010, but I think that we all need to be much more concerned and careful about the “ifs” and “buts” and “coulds” in reports.

Tom Vanderwell

Housing Won’t Collapse in 2010, says Radar Logic

By JON PRIOR
December 17, 2009 12:02 AM CST

The US housing market could be in for some serious trouble in 2010, but predictions of a second collapse are “exaggerated,” according to a report from Radar Logic, a real estate data and analytics company.

Of course, before calling an end to the recession, everyone will keep an eye on unemployment. Many believe the rates will peak in the next two or three quarters and decline. Once that happens, according to the report, housing demand with strengthen even more.

“While we are not out of the woods yet, our view is that housing is showing signs of stability, markets are showing signs of rational behavior and everyone is starting to understand the fundamental problems that brought us here,” according to the report. “As such, we think the bears are overdoing it.”