Home prices may be approaching stabilization. So says Irwin Kellner, chief economist for MarketWatch.
Kellner has analyzed the current ratio of median sales prices for new and existing homes to household income, compared them to the ratio prevalent during the housing boom of the 1980s, and found them to be identical. According to Kellner, the housing boom of the past decade saw the sales price-to-income ratio artificially inflated to unsustainable levels, but now it is stabilizing, and housing is more affordable today than it was in the 1980s. Read his MarketWatch.com commentary here.
