No US House Price Recovery Until 2014

Today an article appeared with an economist saying that US housing prices will not be rising until 2014. What does that mean to the average Canadian? An opportunity.
We've all heard about Canadians buying homes in Florida and Arizona at a fraction of what they would have cost in 2008. It appears there's still an opportunity for those of us who did not take advantage of this earlier.
How can a Canadian buy a property in the US? As a foreigner you need to provide at least a 25% down payment. With prices this low 25% isn't a huge number and the monthly mortgage payments might be $250, more like a car payment.
How do you get the 25% down payment? If you own a home in Canada and have owned it since at least 2006 you probably have at least $100,000 in equity. A Calgary mortgage broker like myself can arrange a line of credit or refinance your home to get you the cash for this investment. If you are interested in taking advantage of a once in a lifetime opportunity contact me and I will be happy to help you.

Here's the full article.

U.S. home prices won’t rise consistently until 2014 amid continuing structural problems in the housing market, an economist argues.

In Capital Economics latest look at the housing market, economist Paul Dales says that the current double dip in the market won’t reverse course quickly. He argues that the low level of demand isn’t something that a general economic recovery can easily fix.

Rising down-payment requirements for homes are keeping first-time buyers on the sidelines, while widespread negative equity is making it difficult for repeat buyers to move up to more expensive houses. “These constraints on demand are structural rather than cyclical, meaning that even faster employment and income growth over the next few years is unlikely to lead to anything more than modest rises in home sales. In any case, in recent months the economic outlook has deteriorated,” Dales writes.

To make matters worse, Dales notes that the risks to his forecast are more to the downside than the upside. If the economy stagnates, with the unemployment rising back up near 10% and disposable incomes declining that would put further pressure on housing. Meanwhile, if markets begin pushing up Treasury yields that could send mortgage rates higher. “After a year’s lag every 0.25% rise in mortgage rates tends to reduce house price inflation by between 1% and 2% per year,” he writes.

Courtesy of WSJ Real Time Economics