Projo 7 to 7 News Blog

WARWICK, R.I. -- The national housing market has returned to its normal balance after a buying frenzy in the first part of this decade led to a collapse last year, an economist with the National Association of Realtors said Wednesday afternoon.

That can set the stage for buyers to return to the market and house prices to stabilize, S. Lawrence Yun said at a conference sponsored by the Rhode Island Association of Realtors.

Yun said that, at today's mortgage rates, a median-priced house is as affordable to a median-income houshold as it was in 1998, before the run up in housing prices.

"It's more affordable to buy a home than ever," Yun said. "There's no reason for home prices to fall. It's a psychology game that will force prices to fall."

And, Yun said, buyers who have been waiting on the sidelines may have reason to enter the market now, enticed by low mortgage rates and federal tax credits.

"We are finished with this bubble burst, and now we are back to normal," he said. "I see a light at the end of the tunnel. I think the worst in housing is happening now or has already passed."

 Tags  Rhode Island Association of Realtors

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