Based on the latest State of the Nation's Housing report by the Joint Center for  Housing Studies of Harvard University,  it will be a "Rocky Road to Recovery".

"The homeownership rate has already fallen from 69 percent in 2004 to below 67 percent in 2010, and "the farther the homeownership rate falls, the longer it will take to work through the excess inventory of homes for sale and held off market," the report concluded.

"Unemployment rates are still hovering near 9 percent and confidence remains relatively low." stated the report. "In addition, the persistent decline in home prices, the ongoing foreclosure crisis, the large shares of underwater homeowners and tight lending standards are all holding back homebuyer demand."

Other issues include the fact that Census data shows that household growth rate by the end of 2010, slowed by half of what it was in the first 7 years of the decade.

Even though new home building has slowed dramatically, the baby boomers will soon be looking to downsize which will add to the glut of homes on the market. And the creation of new households by young and middle adults is slower as they delay going out on their own, because of the job situation and new, stricter loan requirements. 

In spite of this, reports Inman news, "low interest rates and weak prices have made homeownership more affordable than it's been in decades and several strong months of private-sector job growth in early 2011 are "encouraging signs of a housing market rebound."

In conclusion, the report stated that, " "While it is difficult to gauge how close the market is to balance, the longer-term outlook is positive."  

Read the full report at The Joint Center for Housing Studies of Harvard University.

Photo by blog.cleveland.com

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