It’s been a bad news week for the nation’s beleaguered housing sector.
On Wednesday, a survey of more than 100 economists, real estate experts, investment analysts and marketing strategists was released in which most respondents said the housing market would continue to struggle for the next four years.
That followed a Commerce Department report Tuesday indicating that housing starts fell 5 percent in August, a three-month low.
The housing survey, conducted by MacroMarkets, a financial technology firm co-founded by Yale University economics professor Robert Shiller, said that five years after home prices peaked in the United States, “overall expectations continue to dim.”
Home prices – which have fallen more than 30 percent since 2005, according to Standard and Poor’s Case-Shiller 20-city index – “will grow at a mere 1.1 percent nominal average annual rate through 2015,” the survey projected.
Meanwhile, the 571,000 housing starts in August were nearly 20,000 fewer than analysts had predicted, and less than half the 1.2 million starts that, economists say, are typical of a healthy housing market.
The National Association of Home Builders said that the Commerce Department’s disquieting housing numbers fell in line with its third-quarter forecast. It’s “in keeping with the anemic economic and job growth we are seeing across most of the country,” said Robert Denk, the association’s chief economist.
The prolonged depression of the house sector is a drag on the nation’s economic growth, economists say.
Following previous recessions, housing accounted for more than 15 percent of the nation’s economic growth. But since the most recent recession officially ended in 2009, housing has had a net negative impact on the nation’s gross domestic product.
In fact, housing construction fell in 2009 to its lowest level in a half-century, and has barely improved since. That has had a ripple effect throughout the economy, because each home that is built generates about three jobs for one year and about $90,000 in taxes, according to NAHB.
The White House and the Federal Reserve are considering ways in which to revive the struggling housing sector.
Nearly three-quarters of those who responded to the survey said it was “highly likely” the government would take action over the next 12 months; however, 57 percent said that the prospect was “undesirable” because it might very well impede, rather than hasten, the housing recovery.