Tags: Robert Shiller | home prices | housing | economy

Yale's Shiller: Rise in Home Prices Likely to Slow This Year

By    |   Sunday, 20 April 2014 06:40 PM

Home prices will likely increase for the rest of the year, but at a slower pace—"nothing to get excited about," says Nobel laureate economist Robert Shiller of Yale University.

"There are some weak signs, but . . . momentum is a very strong factor, and the momentum still appears to be up," Shiller told Yahoo.

The S&P/Case-Shiller index home prices in 20 cities gained 13.2 percent in the year through January, the smallest gain since August.

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"I do worry," Shiller said. "I don’t have a crystal ball. Prices may fall, but I don't see solid evidence they're going to fall."

Home prices have historically risen from year to year, but there's no guarantee the trend will continue, Shiller said. Indeed, already it "may be changing," he said.

"We have had more investors buying houses. They may be changing their minds now that they see momentum weakening."

In addition, the support that the Federal Reserve provided to the housing market through quantitative easing is now being tapered, Shiller noted.

"It's not at all clear that momentum is a safe bet anymore."

Others appear to share Shiller's view about the path for the home market in 2014. "Housing will contribute positively to GDP this year, but not by nearly as much as in 2012 and 2013," Dana Saporta, director of U.S. economics research at Credit Suisse, told Bloomberg.

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Economy
Home prices will likely increase for the rest of the year, but at a slower pace — "nothing to get excited about," says Nobel laureate economist Robert Shiller of Yale University.
Robert Shiller, home prices, housing, economy
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2014-40-20
Sunday, 20 April 2014 06:40 PM
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