American Housing Market by Ludmila Martinicka

The weak housing market could shake the country into an economical recession. Some forecasters say, the housing crisis will probably continue till early 2008, others are convinced, that the situation will continue till summer. What everybody agrees on is, that the situation seems to be worst since the World War II. The prices of houses will probably decrease about 13 percent in early 2008. What is a good new for those, who would like to buy a house, but bad for the sellers and seems to be bad for the economy as well. During 2004 & 2005 contributed almost a percentage point to annual real gross domestic product growth.It seems, that this problem have spread to Europe and Australia too and now it influence the financial market worldwide. Due to this situation, people are in the dangetr to loose their homes.Housing markets will probably, according to the Moody's Economy.com report, crash and suffer price drops of more than 30 percent before the housing crisis is over. The report also said, that it will influence the economy, but it won't be so strong to break it down.By Feldstein, specialist in the economical area, that United States faces now three challenges, that are: declining home prices; the subprime mortgage crisis; and weakening home equity withdrawal and refinancing. Other specialist stated, that it is not possible to rescue investors from the losses.Feldstein acknowledged that policy-makers faced a dilemma: cut rates and face higher inflation later, or fail to move and fail to avert recession. Doesn't matter what are the speculations, important is to have a roof above your head.

related story: http://news.yahoo.com/s/nm/20071206/bs_nm/usa_economy_housing_dc;_ylt=ApPJCpwvBswNHzL4Z5GSjQ.s0NUE

by Ludmila Martinicka for PocketNews (http://pocketnews.tv)

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Edited by Zuzana Tylkova