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Housing’s diminishing expectations

Phoenix Business Journal – by Jan Buchholz

With apologies to Charles Dickens, Monday is beginning with not-so-great expectations. At least when it comes to the local housing market.

In the Monday Morning Report distributed by R.L. Brown Reports, the mood is decidedly subdued as far as ascertaining a return to normal in the market.

The West Valley-based researcher and consulting firm surveyed 86 housing professionals, asking them how long it will take for the housing market to recover. The firm defined recovery as the volume of sales reached in 2003 in Phoenix. The recovery also assumes that only minimal, if any, federal assistance is forthcoming.

Of the 86 participants, 24 said they expect a recovery to take another three years. The surprise might be in the number who think the recovery will take more than six years: 18 respondents or nearly 19 percent. Most, however, expect a three- to five-year timeframe.

Greg Burger, partner at R.L. Brown, issues a cautionary observation as it relates to housing and construction.

“The outlook doesn’t bode well in the near term for a revival of construction employment in the region, and construction employment has been a backbone of the economic health of the region for decades,” Burger said.

He ends with a plea to government officials and politicos: “This should suggest to government planners and to the political leaders that long-term solutions must be found for Arizona’s economic problems and that temporary fixes won’t work this time around. Will they get it?”