Geithner: Market Shows Signs of Stabilizing

From Secretary of the Treasury Tim Geithner recently spoke before the Congressional Oversight Panel. Here’s what he said about housing:

“Housing markets are showing some signs of stabilizing and wealth is recovering, which should stimulate consumer spending – vital to American economic growth. For example, the seasonally adjusted S&P/Case-Shiller U.S. National Home Price Index rose by 1.8 % and 1.9 % in the second and third quarters, respectively. Since March, sales of existing single-family homes have increased by 20%.”

“However, the financial and economic recovery still faces significant headwinds. Unemployment remains very high, along with foreclosure and delinquency rates, and housing markets are still overwhelmingly dependent on government support. Lending standards are tight and bank lending continues to contract overall, although the pace of contraction has moderated and residential mortgage lending by banks has stabilized.

“Commercial real estate losses weigh heavily on many small banks, impairing their ability to extend new loans. Further, although securitization markets have improved, parts of those markets are still impaired, especially for securities backed by commercial mortgages. These conditions place enormous pressure on American families, homeowners, and small businesses, which rely heavily on bank lending.”

Source: Mortgage News Daily