Economists See Bottom for Sales but Not Prices

Home sales should bottom out by mid-2009, but house prices will continue to decline, according to a survey of 50 members of the National Association of Business Economists. The panel of 50 economic forecasters expects the Federal Housing Finance Agency house price index will decline by 6% this year and 3.5% on 2009. "When asked to identify the bottom in home sales, the panel is evenly split between the current quarter and next two quarters. Thus, the general expectation is that home sales should trough by mid-2009, as should housing starts," the November NABE Outlook report says. NABE president Chris Varvares said the business economists "became decidedly more negative on the economic outlook" since the October survey. And nearly all (96%) of the economists "believe that a recession has begun."