INSPIRED BY JOHN MULKEY'S ECONOMIC FORCAST FOR 2011, Housing and Economic Predictions for 2011 and Beyond
JOHN HAS A VERY NEGATIVE FORECAST FOR THE HOUSING INDUSTRY.
SADLY, Lenn's forecast is even MORE NEGATIVE. I agree with John's comments fully, but I would add a critical element that will negatively affect the economy and the housing industry for years to come.
LOSS OF CONSUMER CREDIT. The loss of credit by all consumers who experienced a foreclosure, a short sale or a bankruptcy will take many years to cure. Some consumer segments may recover sooner because they can be be fueled by cash purchases or higher intrest credit. Housing is rarely a cash purchase and guidelines for mortgage loans is tighter than it's been in 5 years and is getting tighter.
FAULTY FOCUS. The government in it's prognostications, machinations manipulations and crafty schemes looks at the economy from the top down; Wall Street, banks, industry profits, home buying programs, subsidies, etc.
HOUSING FUELS THE ECONOMY. However, the American economy has always been consumer driven, from the bottom up. Further, housing and the employment that it supports, the creation of updated stock and creation of infrastructure, etc., has always been the engine that fueled the American economy. Home sales fuel the economy through the many industries that it supports; furniture and fixtures, appliances, building materials, maintenance supplies and more.
THE ELEMENTS FOR A HOUSING INDUSTRY RECOVERY ARE NOT ON THE HORIZON.
WE'LL HAVE TO WAIT A FEW YEARS TO SEE A RECOVERY IN THE ECONOMY. The housing industry will then be poised for a roaring rebound.
I CAN'T WAIT!!!
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