One the heels of bad housing numbers from S&P/Case-Shiller, Federal Reserve chief Ben Bernanke told a news conference that the largest threat to the US economy remains home prices. He said that the problem shows no improvement after four years.
While the Fed has upped its predictions for unemployment next year and in 2014, and it expects an modestly better GDP growth than it forecast earlier in 2012, its governors do not appear to be sanguine about the housing market. The weight of underwater mortgages continues to snag sales, and increase the odds of high foreclosures.
One set of research should encourage Bernanke. Real estate firm Zillow recently released data which showed that a number of major home markets had already bottomed or will do so this year.