An article in the Wall Street Journal How Will the Housing Market Look in 2010?, Nick Timiraos list five issues.
Mortgage Rates: The Mortgage Bankers’ Association says that it expects rates to rise by around one-quarter of a percentage point, but others say rates could jump by as much as a full percentage point.
Fannie, Freddie and the FHA: The future of Fannie and Freddie remains nearly as uncertain now as it was one year ago, but the White House has said it will offer its recommendations on how to remake the U.S. housing-finance infrastructure early this year.
Loan Modifications: Loan modification efforts have helped to hold back the supply of foreclosures for sale.
More Loan Resets: Meanwhile, more interest-only loans that allowed borrowers to avoid making principle payments for three, five, or seven years will reset to higher payments.
Tax Credit and Home Sales: While it wouldn’t be surprising to see prices tick down again during the winter, when home sales are normally cooler, there’s still a good deal of debate between housing economists and analysts over whether a “double-dip” could lead home prices to fall below the bottom that was set last April.
Some additional questions, I think you might want to consider:
How will the market affect the size of new home construction in 2010?
What impact will the above issues have on the 2010 housing supply?