The Stanford-based Sphere Institute also says price appreciation will slow significantly from the double-digit levels of recent years. Research analyst Matthew Newman says it’s becoming a buyer’s market.
"We’re clearly on the cusp of a change in the housing market where it’s becoming much easier to buy a house than it has been for the last several years. There’s more inventory on the market, homes are staying on the market longer and buyers have a lot more to choose form."
But Newman doesn’t expect a big drop in housing prices. He says overall, housing prices will remain stable or even grow slightly in the coming year or two.
The new forecast also looks at employment for 2006. Research analysts predict job growth will remain in the 2.5% range.