The ever-optimistic National Association of Realtors believes the worst housing downturn since the Great Depression is almost over.
Other housing organizations aren't nearly as effusive. So whether the 1.1 million-member NAR knows something the others don't or it is caught up in the fantasy that is part and parcel to the Disneyland experience remains to be seen. But either way, it says price appreciation will return to the moribund housing market in 2012.
Speaking across the street from Disneyland, the "Happiest Place on Earth," at NAR's annual convention in Anaheim, Chief Economist Lawrence Yun said signs are developing that signal a "recovery occurring next year and continuing into 2014."
It won't be a great, robust expansion but rather a moderate, respectable recovery, Yun said at a press briefing. And spurred by a combination of population growth, a gradually improving employment picture and people anxious to leave their parents' basement and finally move out on their own, price appreciation should once again return to the market next year, the economist ventured.
Prices won't rise by much, he predicted; only 2% in 2012, 3% in 2013 and 4% in 2014.
That's not terrific for people who bought at the peak of the boom, many of whom have seen the value of their properties drop by a third, according to some estimates, Yun admitted. "It will be quite a long time for those people to see a full recovery," he told reporters at a press briefing. "But it's good for new buyers."
NAR, which calls itself "The Voice for Real Estate," is betting that the tight credit conditions that have been holding back buyers will ease enough next year to allow at least some to take advantage of the best housing affordability conditions in years.
Based on the relationship of home prices, mortgage rates and family income, housing affordability hasn't been this favorable since 1970, Yun said. And it should be almost as good again in 2012, when it will be the "second best year on record," second only to 2011.
"Our hope is that credit restrictions will ease and allow more home buyers to take advantage of current opportunities," he told reporters. "If we could maintain sound and reasonable mortgage underwriting standards, the market would be able to avoid a future big boom and bust cycle."
