by Calculated Risk on 8/23/2007 02:27:00 PM

From the WSJ Econ Blog: Fresh Looks at Housing Slump.

“We have made further concessions to our housing forecasts given turmoil in the mortgage market. ... We now expect starts to fall to about 1.2 million by the end of next year ... We now expect OFHEO home prices to fall 2.5% next year and NAR and Case-Shiller home prices to fall between 3% and 5%.” – Lehman Brothers Economics

It's taken some time to make these "concessions", but these forecasts are getting closer to the mark.

Regarding this next quote, I wish we could come up with some better phrasing than "pre-" and "post-" turmoil. But I suppose we are stuck with it:

“Friday’s data on new home sales are clearly ‘pre-turmoil’ but should nonetheless be shockingly weak, underlining that the housing market was continuing to meltdown even before the credit crunch of recent weeks.” – BNP Paribas Fixed Income

Actually the credit crunch has been building all year. The 'turmoil' was a liquidity crisis on top of the building credit crunch.

The BNP quote is a good reminder that the New Home sales data tomorrow is pre-turmoil (for July). Also BNP mentioned that cancellations have picked up again, so Census Bureau reported sales will be overstated (and inventory increases understated).