Did You Know: Recession "Very Likely Over"

September 17, 2009

 By Jed Smith, Managing Director, Quantitative Research

• The Federal Reserve System’s Chairman Dr. Bernanke has told us that the recession is “very likely over.”
• The economic data can be contradictory—some up, some down, and some subject to revision. NAR’s Realtors® Confidence Index publication presents several data series providing insight to housing market economics. The data is based on monthly responses from approximately 3,000 Realtors®, who deal with the housing markets on a daily basis.
• During the January-March’09 time frame 66 percent of Realtors® expected housing prices to decline in the next year. In contrast, 33 percent of Realtors® expected declining prices during the June-August‘09 timeframe, with 57 percent expecting modest price growth (constant or under 5 percent), and 10 percent expecting price growth over 5%.
• Realtor® confidence in the housing outlook rose to 42 (out of 100) in June-August’09 versus a Jan-March’09 confidence of 36.
• What does the data tell us? On balance the data suggests that we have started to move towards improvement. The economic and housing recoveries appear to be a little slower/modest than many would like.
• Extension of the $8,000 tax credit, which we estimate to have resulted in an additional 350,000 sales on an annual basis, would be a help in moving the market along.
• The two housing data series appear to confirm Dr. Bernanke’s observation.

This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >

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