Markets & Economy

Housing should be booming, so what’s going on?

Low inventory is holding back the market

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MIAMI -- Given that mortgage rates continue to hover around historic lows and we're seven years out from the housing bust, the housing market should be booming -- but it isn't. That's according to economists who spoke Friday on a panel at the National Association of Real Estate Editors (NAREE) conference. Things are getting better, they said. Frank Nothaft, chief economist for real estate data and technology firm CoreLogic, expects a 5 percent gain in home sales next year and noted that consumer confidence is at its highest level in eight years. National Association of Realtors Chief Economist Lawrence Yun anticipates home prices will return to their 2006 peak sometime this year, though home sales will remain 25 percent below peak. Nothaft was not quite so optimistic, pegging a return to 2006 house prices by the end of 2017. Yun predicted that even if the Federal Reserve begins to raise interest rates this year, we may see only a "slight budge" in 30-year mortgage rates...