And who might that guru be? Bill McBride from Calculated Risk.
Some are predicting another ‘shadow inventory’ coming to market this Fall-Winter that will cause a foreclosure supply shock that will in turn push prices downward once again. McBride doesn’t agree: “The bottom line is house prices have probably bottomed, and the concern about more distressed sales coming is real – but will probably not push house prices to new post-bubble lows.” 8/14/2012
The general rule is that housing leads the economy – there are exceptions like in 2001 following the popping of the stock bubble, and recently we’ve seen a recovery without housing – but the housing recovery suggests, barring a significant policy mistake in the US or Europe, the pace of the economic recovery should increase in 2013.
McBride: the recession in construction employment has bottomed
The housing recovery is here. The construction jobs are coming. Bill McBride, Calculated Risk
Even though construction is down since the beginning of the year, and only increased by 2,000 jobs in June, construction employment appears to have bottomed, and should add to both GDP and employment growth in 2012.
Other construction indicators – housing starts, new home sales, construction spending, builder comments – are all improving (although public construction spending is decreasing), and construction employment will follow.
A little Kung Fu:
Young Caine: “Old man, how is it that you hear these things?”
Master Po: “Young man, how is it that you do not?”