John Paulson Sees Housing Rebound Starting This Year
Now-famous hedge fund manager who foresaw the housing collapse sees a V-shaped recovery and gains in house prices
Palm Coast, FL – May 10, 2010 – Hedge fund manager John Paulson today forecast a rebound in the housing market during a 1 hour and 20 minute conference call. He told investors that he expects a V-shaped recovery with home prices gaining 3% to 5% this year and 8% to 12% next year. Paulson recently gained notoriety when he bet that the housing industry would collapse in 2007, making his fund $15 billion.
Paulson suggested to those on the call that "If you don’t own a home today, now is the time to buy one."
retired
Is this the same Paulson associated with the packaging of subprime mortages which he eventually shorted and marketed to Goldman?
Paulson Pridictions
Here we go again, look for the Real Estate Agents, Mortgage Brokers, Appraisers, et all to start the same old shannaigans again.
Cheaper to rent right now and if anyone without job security and that is almost everyone, has a lick of sense, they should not buy. No more professional hype please.
Depends
I think his comment was very vague. If he is talking about California he is probably correct. If he is talking about Florida he is very wrong. I also suspect that we are just now hitting the tip of the ice berg with the high end foreclosures. Another article this weekend stated that 12.5% of all million dollar plus homes are 90+ days delinquent. Let’s also not forget about all of those stupid option arm loans that are out there which should all be resetting right about now and going for the next 18-months. We have a solid 2-3 years of having our teeth kicked in depending on the particular market and geography of the real estate.
Smoke and Mirrors
As a general statement, he’s right, but every location is different. There are areas that have no shot at going up, due to unemployment. Then there are areas that have gone down so far, there is no place to go but up. The macro ecomonics are at work, as BIG MAC, (the Federal Government)is killing the US dolar by all the spending. That can only be saved by higher taxes and higher interest rates, which will kill the housing market. We will never return to the days when you could buy a newly built home and have it increase year after year. Paulson, is smart enough to bet both ways and win. It’s called a straddle, which covers you in both directions, up or down. Cash is becoming king, for many, as long term mortgages are what got us into this real estate mess. That’s why many cheap house are selling, and high end is disappearing.
Hope
Like an old lumberman told me years ago, "Live in hope…die is despair."
Study Says Return 2025
Hmm, I just read ‘certain metro areas in CA FL AZ NV won’t see home prices return to precrisis levels until 2025 or LATER. >Study by Fiserv, Inc-article in May DSNews magazine.
Reply to Bill
The same, however the jury is still out on that.