In an article from Realtor Magazine, Alan Greenspan is quoted as saying that a true economic recovery will not happen until home prices start to climb. Bloomington is doing its part to help the recovery of the economy. Based on single family home sales for this year compared to the same period last year, prices are up:
- 2008 Average sales price was $186,538
- 2009 Average sales price was $193,336
Economic recovery depends on staunching the downward flow of home prices, says former Federal Reserve Chair Alan Greenspan.
As long as home prices continue to decline, the economy won’t stabilize, he predicts.
"The bulk of conforming mortgages made since 2005 are close to being underwater," Greenspan says. "We can take another 5 percent decline in house prices without much macroeconomic impact. But if prices fall by 12 percent, more than 4 million additional home owners will be underwater.”
Source: The Wall Street Journal, David Wessel (06/25/2009)