Economist: Expect home-price weakness to persist

Home sales expected to bounce back to normal by 2012

WASHINGTON — With the economy on the mend, home sales could bounce back to their historical levels by 2012, although the bulging foreclosure pipeline is likely to keep prices in check, economist Mark Zandi of Moody’s Analytics told Realtors holding their annual midyear meeting in the nation’s capital.

Zandi said he expects sales of new and existing homes to grow from between 5.5 million and 6 million this year to between 6 million and 6.5 million next year, and hit about 7 million in 2012.

That would put home sales back on their historic trend line. But Zandi said that when it comes to home prices, "the coast is not quite clear."