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KB Homes: U.S. Home Prices Will Drop 10% More

Excerpt from Bloomberg video interview:

U.S. home prices likely will drop another 10 percent from their peak before the housing market begins to recover, said Eli Broad, founder of Los Angeles-based homebuilder KB Home. "Every housing market's different, but you can expect housing prices to continue to decline in most markets for the next year or so,'' Broad said in an interview from Los Angeles with Bloomberg Television.

Sales of previously owned homes in the U.S. fell 1 percent last month and the supply of unsold properties reached a record, the National Association of Realtors said last week, signaling a continuation of the 27-month housing slump. The median price of an existing home fell to $202,300 from $219,900 in April 2007. "I think we've got probably another 10 percent to go'' from the price peak reached in 2006, Broad said today.

Broad said the U.S. economy is "in a recession no matter how you want to measure it,'' and recommended that investors put their money in the energy industry, multinational companies with the largest stock-market capitalizations, and emerging economies such as Brazil, Russia, India and China. The return on U.S. stocks likely will "be in low single digits'' this year, he said.

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Posted at 06:13 PM | TrackBack

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Housing Market in Decline

From the New York Times:

"Housing sales normally increase during the Spring, but sales have been declining compared to previous years. As sales decrease, the housing stock rises, helping to lower prices."

Posted at 07:31 PM | TrackBack

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Buy or Rent? Look at the Rent Ratio

From the New York Times:

"The housing bubble drove up prices to unreasonable heights, based on a ratio of home prices to rental costs. But in some areas, prices have fallen far enough to make buying conceivable again"

Posted at 07:13 PM | TrackBack

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weeHouse Brochure

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