Mixed Signals on Housing and the Economy, but is a ‘Boom’ Just Around the Corner?

If uber investor George Soros is selling gold these days that tells us something. Or does it? The recent not-so-great reports on housing and employment are hardly encouraging. The economy isn’t adding many new jobs and state and local governments continue to slash away like Michael Meyers. (The latter is hardly surprising given the awful condition of state budgets.) But if Soros is selling gold that means he believes there may be better returns elsewhere – maybe in real estate. I don’t want to give anyone false hope, but despite some of the ugly economic signs, there are a few ‘positives’ to cling to: mortgage rates are once again falling to new lows; the cost of renting in many cities is now more expensive than owning; new home construction is anemic, and in time, an over-supply will turn into a potentially huge shortage. But when will that day come? There are two keys to a revival in housing: better employment numbers, and the GOP and White House finally striking a deal on the budget. Also, lending standards must be loosened, at least a little bit, and the QRM problem needs to be fixed. Now. Otherwise, all bets are off…