A witch’s brew of factors is cursing the US housing market, reports the New York Times, driving home prices ever lower as they search for bottom. Rising unemployment, higher interest rates, lower wages, and a glut of foreclosures are likely to continue to keep the market depressed through much of 2009 as the economy slips into recession, experts caution.
“We are in uncharted waters,” said one real estate expert. Nearly 3% of previously owned homes and nearly 10% of rental properties are vacant, the highest rates on record. And, despite federal intervention, rising mortgage rates continue to price more potential buyers out of the market. “The rocket has run out of fuel, and now it’s plunged back down to earth,” said one analyst.