The National Association of Realtors (NAR) expects the nation's housing recovery to proceed through the coming years, as long as Congress and President Obama do not hinder the availability of mortgage credit through wrangling about the "fiscal cliff," a pileup of tax increases and spending cuts scheduled for the start of 2013.
The housing market "clearly turned around in 2012," Lawrence Yun, chief economist at the NAR, said during the group's Realtors Conference and Expo, which ended Nov. 12. "Existing-home sales, new-home sales and housing starts are all recording notable gains this year in contrast with suppressed activity in the previous four years, and all of the major home price measures are showing sustained increases," he said.
After 2012 is tallied, Yun sees the U.S.'s gross domestic product (GDP) increasing 2.1 percent, and he expects growth of 2.5 percent in 2013; however, he said that "these projections assume Congress will largely avoid the 'fiscal cliff' scenario." Yun also said he fears a fiscal cliff scenario could derail an economic recovery from the imploded housing bubble of 2006. "While we're hopeful that something can be accomplished, the alternative would be a likely recession, so automatic spending cuts and tax increases need to be addressed quickly."
Formal fiscal talks between Republicans and Democrats will take place Friday at the White House, according to USA Today. President Obama is aiming to raise taxes on those making more than $250,000 annually, while Republicans hope to cut social programs and keep defense spending and tax rates the same.
