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Wednesday, July 13, 2011

20% Drop in Housing to Cause Recession in 2012 according to the experts!

I had a feeling we were heading in this direction, now the experts are predicting this as well.
With GDP growing at 2.7% to 2.9%, which is lower than the plus 3% forecast they made in April. It looks like no matter what action the Fed takes. "Economic growth here and abroad is slipping, making a 2012 recession a distinct possibility.


The problem with the real estate market remains excess inventory. Based on Shilling's research, there are 2 million to 2.5 million excess homes in the country -- a supply that will take 4-5 years to work-off. The result: Housing prices will fall another 20% and underwater mortgages will balloon from 23% to 40%, he says.

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