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-- terror reality check for the struggling real estate sector as home prices fell for the fourth straight month in December.
To levels not seen since 2008 so what's to blame and what happened to the recovery joining us now is David Blitzer managing director and chairman.
That the S&P index committee thank you for being on the show today David because we seem to get a wide range of numbers when it comes to the housing sector yesterday pending home sales -- -- Today -- sat S&P Case Shiller Index showed that.
And home prices fell to new lows that we haven't seen in sent home crisis began so.
How worried do we need it to be about these numbers that we got today.
It would probably more disappointed there -- worry.
We -- the -- -- obviously all three major series went down the national attends city in the twenty city composite.
And where that new post boom bust lows or so the close below it -- the bus may still be here I guess.
But looking at a lot of other data home sales household formation.
That association homebuilders pending sales numbers that came out.
All these kind of figures.
Are showing that there is some improvement going on in housing market more people seem to be out there looking and that may be a few of them are buying.
The reason fitted the apparent disconnect.
Is it things have to happen -- sequence.
For of people gets under -- to the idea behind our house then they go look.
Then a few of them start divine and then finally.
Home price he should stabilize and Begin to move up you know -- if you'd figure that sell your house and you worried about the price.
Not even think about doing anything until at least some guy six blocks over management talent and how great dating a guy down the plot gets a good price.
They he'll raise your price to go in the market it -- to -- at the palace Xbox.
Starts -- snowball options snowball effect off one another you talk about the complicated nature of the housing market that.
What we're seeing is -- this -- David but there's so many reasons why we haven't come up off of the bottom.
What in your mind is the biggest roadblocks to the recovery in the housing market why isn't it picking up more steam considering we've seen.
Up until now oil -- prices low consumer confidence -- the market -- jobs picking up lots of positive catalysts here.
Getting a mortgage I suspect is one of the biggest reasons.
The banks -- very that it now locking the barn after the horse -- -- when they've made too many mortgages.
Back into -- than 56 and seven.
And they haven't really eased up.
People get mortgages are the ones.
-- or in houses there it is well above water very good shape.
And all they wanna do would be -- -- these delicious -- low interest rates those aren't the people they gonna help the housing market the people who are having more difficulty.
-- somebody a year or two out of college in his or her first job we're looking for that first house they don't have much of a credit record the banks in their -- And they want a lot borrowed 75 or eighty or 85% of the price of the house or.
If they have a house -- and underwater but those are the people who are really got to jump start the housing market then that's to me the key issue.
David I wanted to piggyback off that let's just think about this for a moment if this lingers much longer.
Could we have some sort of serious paradigm shift work in this country the American dream is no longer the white picket fence in the house in the family in a two car garage that kind of thing.
More more apartments are being billed people seem to be satisfied -- renting words clearly cheaper to -- could this be something of a permanent shift.
I -- a permanent can be for a long time but I think there is it there is certainly some shift that will would -- be whether it's for awhile.
Homeownership -- for five years ago at least so.
It's -- come back up I it will -- down and the longer term -- -- you know it people don't expect to.
A get out of school and take your job and retire -- -- job the -- 65.
They probably expect that half a dozen jobs.
-- why they expect to move around a lot and all that argues for -- and certainly of its hard to get a mortgage or you have residual concerns about a thirty year financial commitment which has like an awfully long time.
Randy is very attractive and that again they have plenty of time you -- all kinds of fancy amenities and a nice new apartment building.
On the -- the putting yourself have you bought a house.
David before LA go very quickly I want something if they'll go to back here because there's lots -- reason for us to feel nervous -- are concerned as you said.
What should we mean feeling more positive about.
In the housing area I think that we seeing improvement starts and in fact we saw a lot more single family starts shift away from apartment.
We've seen some improvements -- we've seen the pending home sales numbers improve.
We -- almost everything but prices improved.
The big I am now overall the whole picture is.
The employment picture initial unemployment claims as -- well -- the part of how the market.
Since sometime in December and to me that's the best single -- rapidly available indicator and for the last two and have -- it's -- very very nice.
David let's marry you gave me some and still got about I appreciate that not easy to do BS and and I think that's good afternoon.
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