NEW YORK, July 28 (UPI) -- The supply of homes is down but rising foreclosures and tighter credit are putting downward pressure on U.S. home prices, The Wall Street Journal reports.
The newspaper said Monday its quarterly survey of housing data found the supply of homes declined in 19 of the 28 big city areas studied. However, the supply is still large enough that buyers have plenty to choose from -- and the economy is losing jobs to such an extent that there will likely be more foreclosures and fewer home buyers, the newspaper said.
Mark Zandi, chief economist at Moody's Corp. Economy.com, told The Journal he expects it will be at least spring 2010 before there is a major recovery in home sales and prices.
"The recovery will vary considerably across the country, with California recovering quickly and Florida much more slowly," Zandi said.
Congress last week passed a housing bill that would allow the Federal Housing Administration to insure up to $300 billion in new 30-year, fixed-rate mortgages for at-risk borrowers if their lenders agree to write down loan balances to 90 percent of the homes' current appraised values.
Sen. Chris Dodd, D-Conn., a supporter of the legislation, said it would help nearly 1.5 million families facing foreclosure.
The bill would establish a stronger regulator for Fannie Mae and Freddie Mac.