According to Jan Hatzius, chief economist of the Goldman Sachs Group in New York, the U.S. housing market could, finally, be approaching the bottom. And that’s good news: “Over the next few years,” says Hatzius, “the housing sector is going to improve” although there is still “a lot of excess supply out there.” Other analysts agree, saying that since “the economy doesn’t seem to be falling off any more,” sales in many areas around the country will likely level throughout 2011 and could slowly climb in 2012. This seems hypocritical to me...if there is excess inventory, it is going to be hard to believe that we have hit bottom. Simple laws of supply and demand would dictate that if there is excess inventory, prices would continue to fall.
Naturally, the markets throughout the country will improve at various times just as they were damaged at different times in this cycle. In my opinion, until inventory stabilizes, lending improves and unemployment and the economy improve, there will be no meaningful real estate market improvement.