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The Housing Market: Is Hope Around the Corner? The U.S. Perspective 2005: Housing construction’s all-time record… Source: U.S. Department of Commerce …driven by home builders, now correcting sharply Source: U.S. Department of Commerce Subprime/Alt-A loans fueled the boom

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Slide1 l.jpg

The Housing Market:

Is Hope Around the Corner?



2005 housing construction s all time record l.jpg
2005: Housing construction’s all-time record…

Source: U.S. Department of Commerce


Driven by home builders now correcting sharply l.jpg
…driven by home builders, now correcting sharply

Source: U.S. Department of Commerce


Subprime alt a loans fueled the boom l.jpg
Subprime/Alt-A loans fueled the boom

Source: Inside Mortgage Finance



Home values plummeting back to 2003 prices l.jpg
Home values plummeting; back to 2003 prices…

Source: Calculated from OFHEO home price series 1976-1987; Case-Schiller national home price series1988+


With slower declines through 2010 l.jpg
…with slower declines through 2010

Source: Calculated from OFHEO home price series 1976-1987; Case-Schiller national home price series1988+; forecast by Witten Advisors


Fed actions have cut mortgage rates so l.jpg
Fed actions have cut mortgage rates, so…

Source: Federal Housing Finance Board


The decline in house payment is unprecedented l.jpg
…the decline in house payment is unprecedented…




Dfw home prices have been much more stable l.jpg
DFW home prices have been much more stable

Source: Calculated from Case-Schiller home price series; forecast by Witten Advisors


Dfw housing starts boomed in mid 2000s too l.jpg
DFW housing starts boomed in mid-2000s too

Source: U.S. Department of Commerce


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Employment Growth

12 Months ending March 2009

Austin +3.3k

San Antonio -1.5k

Fort Worth -3.4k

Norfolk -6.8k

Kansas City -11.6k

Atlanta -115.9k

Detroit -135.3k

Phoenix -136.0k

Chicago -142.7k

Los Angeles -149.4k

March 2009 Actuals: Job Growth Highlights

Employment Growth Rate

12 Months ending March 2009

Austin +0.4%

San Antonio –0.2%

Fort Worth –0.4%

Houston –0.6%

Washington DC –0.6%

Norfolk –0.9%

Kansas City –1.1%

Columbus –1.5%

Dallas –1.7%

St. Louis –2.3%

U.S. -3.5%

Source: U.S. Bureau of Labor Statistics



Local home values should rise modestly in 2010 l.jpg
Local home values should rise modestly in 2010

Source: Calculated from Case-Schiller home price series; forecast by Witten Advisors


Is hope around the corner well on the horizon l.jpg
Is hope around the corner? Well, on the horizon

  • In DFW, home prices stabilize in early 2010 and rise modestly from there

    • Bottom at prices comparable to 2001

  • Nationally, prices soften until early 2011

    • Back to 2000 price levels



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