Economic expert James Wood provides SLC housing forecast

Economic expert James Wood provides SLC housing forecast

James Wood, director of the University of Utah’s Bureau of Economic and Business Research, said during an economic forecast presentation in early February that he expects real estate sales and new housing construction starts to find a bottom in 2009 with a trough in prices following.

“I think we will probably see a little bit more weakness this year in the median price of homes sold, but by the end of the year and into next year, we will begin to see some stabilization in this market,” Wood said.

To help predict what to expect for the future, Wood compared today’s real estate market to the situation Salt Lake faced in the 1970s. During the ’70s, home sales climbed for several years before hitting a peak but then took four years to establish a trough. Wood compared that housing cycle to the one we’re in today, which saw its peak in 2005. With three years of declines behind us, Wood is predicting just one more year of sales decreases.

“I expect it’s going to be similar to what we had in the previous cycle, where it was a four-year down,” Wood said. “So we’re probably in for another weak year, but I don’t think it’s going to drop like this last year.”

So far, sales have already dropped 44 percent compared to the total 55 percent decline seen in the 1970s cycle, he said.

To see a video of Wood’s entire presentation, visit the uarnews channel on YouTube or request to become friends with Ut Assoc Realtors on Facebook.