by Calculated Risk on 6/11/2007 12:06:00 PM

From MarketWatch: Pulse on housing

It's still too early to tell exactly when this housing slump is going to end, with house prices just beginning to soften, mortgages at risk of defaulting beginning to hit reset dates and lending standards that are starting to tighten, according to researchers at the Harvard University's Joint Center for Housing Studies.

One thing's for sure: Before the sun shines again on the housing industry, a good amount of excess inventory will have to be sold, according to the center's "State of the Nation's Housing" report, released Monday.

This is a stunning statistic:

"In just one year the number of households spending more than half their income on housing increased a startling 1.2 million to 17 million in 2005," Rachel Drew, research analyst for Harvard's Joint Center of Housing Studies, said in a news release.

I believe this isn't correct:

"If you were an economist, you would think that prices would have fallen precipitously," [Nicolas P. Retsinas, director of the center] said.

I believe most economists recognize housing suffers from "sticky prices" and they wouldn't have expected a precipitous decline in prices, rather they would expect real prices to decline over several years.

Here is the report: The State of the Nation's Housing 2007

And the Joint Center for Housing Studies home page.