Forecast Predicts Lower Rates Next Year
How this will affect the greater Seattle region is still hard to predict. We have not felt the housing downturn as much as some regions. I believe that values are still adjusting back to a norm following a very inflated marketplace.
A weakening U.S. economy is setting the stage for lower interest rates, according to a UCLA Anderson Forecast released today.
The forecast predicts real gross domestic product will rise no more than 2.7 percent next year, reflecting the weak housing market.
As a result, the Federal Reserve Board will cut interest rates to stimulate business, says Edward Leamer, director of the UCLA Anderson Forecast. Leamer says he sees the Federal Funds rate falling to 4.5 percent by the fourth quarter of next year.
Leamer also thinks housing starts will bottom out at an annual rate of 1.4 million in the second quarter of next year. As builders seek to sell inventory, new-home prices will fall to a low in the third quarter of 2007, down 10 percent from current levels, he says.
Prices for existing homes also will "nudge down a bit," he adds, noting the housing market downturn will hurt home builders, construction workers, real estate practitioners, and bankers, but will not be so severe as to force a recession.
A weakening U.S. economy is setting the stage for lower interest rates, according to a UCLA Anderson Forecast released today.
The forecast predicts real gross domestic product will rise no more than 2.7 percent next year, reflecting the weak housing market.
As a result, the Federal Reserve Board will cut interest rates to stimulate business, says Edward Leamer, director of the UCLA Anderson Forecast. Leamer says he sees the Federal Funds rate falling to 4.5 percent by the fourth quarter of next year.
Leamer also thinks housing starts will bottom out at an annual rate of 1.4 million in the second quarter of next year. As builders seek to sell inventory, new-home prices will fall to a low in the third quarter of 2007, down 10 percent from current levels, he says.
Prices for existing homes also will "nudge down a bit," he adds, noting the housing market downturn will hurt home builders, construction workers, real estate practitioners, and bankers, but will not be so severe as to force a recession.
posted by peanut at 11:28 AM
5 Comments:
hello dear,
im a first time buyer and have little knowledge regarding the market can you please give me some tips as to how i have to proceed..
thanx
Hmmm - looks like it'll be a great time for buyers (better than it is now). Glad I came across this blog, today's post was definitely something I'm glad to know.
Altair - I don't know if iRealty will give you any tips, but I can say one thing: research and as a first time buyer, you definitely want to find yourself a buyer's agent you feel you can trust. When I was thinking about selling my home, I went on one of those sites that give free home value estimates, and I actually wound up getting hooked up with an agent that was really helpful, even though I didn't wind up selling. If I do in the future, I will definitely use him! (And yes, he did work up an estimate not only of my home, but one I was thinking about buying too)
thank for your sharing , but there are many difficulties in predicting exactly the trend of real estate market
The issue will be with inflation concerns. Unfortunately, long term rates will rise as inflation fears mount.
This is not a good news for the sellers I think. But it is still very helpful for them. The fall in the price of the property and real estates will give an opportunity for the buyers to get homes at reasonable prices. To know about the Brazilian real estate, follow link.
property in Brazil
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