David Lereah Housing Quotations

A modest slowdown in home sales, coupled with improvements in the housing inventory, means the market is in the process of normalization.

A modest downtrend will be good for the long-term health of the housing sector.

A modest downtrend to a sales volume that is expected to be the second-best year ever in 2006 will be good for the long-term health of the housing sector.

The underlying fundamentals of the housing market are solid and sales will stay historically strong, but they will trend modestly down from current peaks. Masked by the data are early signs that housing is starting to wind down from a boom and will transition into an expansion - in other words, a soft landing.

Although mortgage interest rates have risen in the last month, housing affordability conditions remain favorable.

It's a simple matter of supply and demand. We continue to have more home buyers than sellers in most of the country, which results in tight housing inventories and higher rates of home price appreciation.

So, 2005, when we look back, was the best year in housing in recent memory, probably of all time.

The current pace of home sales activity remains historically strong - only eight months have had a higher sales pace. A modest downtrend, to a sales volume that is expected to be the second-best year ever in 2006, will be good for the long-term health of the housing sector.