There was another prominent article this week on the housing market. Like the previous post covering today’s article in the Wall Street Journal, S&P released a study of the US Housing market that suggests that prices will decelerate and stabilize. A crash is not likely.
The bubble should end with a fizzle, not a bang, said S&P Chief Economist David Wyss
The average US home price is a record 3.1 times the average household income up from 2.6 times in 1960. Home ownership is 69.4%, also a record.
Most price appreciation is located in California, northeast and Florida. S&P estimates that it would take a 30% decline in national home prices to start even a modest recession, although they think that this is unlikely.