| The chief economist of Mortgage Bankers | | | | speaking at a panel discussion recently observed |
| Association Jay Brinkmann predicted that by the | | | | that there is hardly any speed in the pace of |
| close of 2010 unemployment will spike beyond | | | | rehiring by the business sector. Houses are being |
| 10% as the housing market will reach its peak | | | | foreclosed because unemployed persons cannot |
| grapping with effects of recession. He announced | | | | pay mortgage dues. The borrowers are |
| these facts at the annual convention of the | | | | handicapped without income. Lenders are left with |
| association at San Diego. It paints the picture of | | | | no other option but to foreclose. The borrowers |
| an economy slowly standing up and the housing | | | | are in no position to carry on even modified loans. |
| sector likewise gradually improving. Home prices | | | | Nevertheless Haldeman underlined the need of |
| are also expected to level after the peak. | | | | lenders to continue with their efforts to modify |
| Mortgage interest rates are likely to continue | | | | loans. He added, "I think it would be a real mistake |
| below 6%. | | | | for the industry to take some of the glimmers of |
| | | | | hope that some might be pointing to in terms of |
| But even that crawling rebound will depend on the | | | | housing prices and housing activity and reduce our |
| ramping up of spending by the consumers. | | | | efforts. I think we ought to assume that there's |
| Brinkmann said, "The recession is behind us but | | | | no improvement, that we don't have enough |
| the effects of the recession will linger for some | | | | certainty about what might happen." |
| time in the form of higher unemployment and | | | | Some foreclosure proceedings have been delayed |
| lower levels of business investment and home | | | | but these cannot be kept pending much longer. |
| construction." | | | | Unemployment is further adding to the confusion. |
| According to the forecast of Brinkmann economic | | | | This situation is likely to continue till the end of |
| movements will be sluggish during the first six | | | | 2010 said Brinkmann. |
| months of 2010. It will not be strong enough to | | | | Foreclosures have led to prices falling and this in |
| slow down unemployment figures that are | | | | turn has led to sales picking up especially in the |
| expected to touch the highest mark at 10.2% | | | | worst hit states like Florida, California, Nevada and |
| during the middle of the next year. It will not go | | | | Arizona. Brinkmann explained, "We still see a |
| down to less than 8% until the latter half of 2012. | | | | concentration in the lower end of the market. The |
| Charles Haldeman Jr. the CEO of Freddie Mac, | | | | entry level homes are in demand. |