Analysts Say House Prices Will Likely Fall

Washington, DC, Nov. 1, 2010 -- Analysts are predicting that housing prices will continue to fall next year, and the robo-signing controversy won't have much impact.

Fiserv, a market analytics company, has scaled back its home price projections. In February, it forecast national price gains of about 4% through the end of 2011. The company's latest prediction is for a 7.1% drop in prices between June 30, 2010 and June 30, 2011.

Morgan Stanley said that about 3.1 million borrowers are seriously delinquent with many expected to lose their homes.

Economist Mark Zandi said more than 4 million are in trouble with half of those expected to go to foreclosure.

Some projections are even more pessimistic.

However, Zandi said he's optimistic that the employment situation is about to improve. Corporate profits have risen, and, historically, hiring follow profits about eight to 10 months later. That means companies should start hiring workers soon.

And once Americans start returning to work, they'll find home prices are very reasonable, Zandi said.