To Fix the Economy, Fix Housing

The latest economist to weigh in on the need to fix the nation's housing sector in order to grow the economy is Mark Vitner, a senior economist with Wells Fargo Securities. Builder Magazine reported that Vitner gave his views in a webinar last Friday presented by the Shinn Group. Said Vitner:

Until housing recovers, the economy will have a hard time growing beyond 2%.

Like many economists, Vitner sees unemployment remaining stubbornly high for at least the next two years due to weak consumer demand and employers’ concerns about the economy and cost increases such as for healthcare.

However, Wells Fargo projects housing starts will rise in each of the next two years and hit 1.5 million by 2016 or 2017. As local forecaster Mark Schniepp said just last week, Vitner believes that there's a pent-up demand for housing caused by a growing population. He also doesn't think that the U.S. is becoming a nation of renters. As Builder reports,

Consequently, builders should be motivated to meet this demand with new construction because “there’s very little new inventory out there.”

You can read the article here.