by Tim McLaughlin, Senior Vice President, Weichert Financial
Billionaire investor Warren Buffett has seen the future of the economic recovery, and he predicts that residential housing will drive the effort. In an interview with Bloomberg Television, the Berkshire Hathaway chairman and CEO said he believes the current 9.2% unemployment rate will fall when the housing sector gets its second wind. “We will come back big time on employment when residential construction comes back,” Buffett said, adding the unemployment rate will decline to 6% when the market is back on track. Buffet’s latest comments confirm his optimism that a housing market turnaround is
imminent. In February, he predicted that a housing recovery would commence “within a year or so.”
Home buyers in the Capital region are stepping up to the plate to buy homes, according to this week’s National Mortgage News. Consumers signed more contracts to buy homes in June in the Washington, D.C. metropolitan area than in any June in the past six years, according to an index of pending transactions published by the local multiple listing service, with pending home sales jumping nearly 30% year over year.
The Washington region is returning “to more normal seasonal patterns,” the RPI Pending Home Sales Index found. It covers the District of Columbia, Montgomery and Prince George’s Counties in Maryland, and Alexandria City, Arlington County, Fairfax County, Fairfax City and Falls Church City in Virginia.
The index also found that the median sales price in the region hit its highest level in nearly three years, gaining 7.3% from May and 7.5% from last year, to $379,990. It is the fourth straight month the median sales price has increased. Also, the ratio of new listings to active ones eased for the third consecutive month, and the number of days on the market fell to a 10-month low of 63 days
Federal Reserve Chairman Ben Bernanke told Congress the Central Bank is prepared to take additional action, including buying more government bonds, if the economy appears to be in danger of stalling (i.e. – QE3?)