N.C. State University economist Mike Walden has long said that the general economy won’t dramatically improve until the housing market improves. Are we finally seeing that improvement?
“I think we are … . And the hope is really stemming from what we’ve seen as a turnaround in home prices. Just a little history: We had virtually a doubling of housing prices on average from the late ’90s to the mid 2000s. Then we had the housing downturn. And we had the average house lose about a third of its value. That was a big part of the recession and a big part of the problems that households had faced since that time period.
“Recently — and by recently I mean over the last year — we have seen in most markets housing prices stabilize and start to go up. And that’s absolutely crucial not only for homeowners but also for the residential housing market — and, indeed, the economy in general.
“Now here in North Carolina we’ve seen the same trend. We’ve seen over the last year housing prices in North Carolina move up by a little bit — about 1 percent. Of course you’re going to have a lot of variation according to market. But this says that North Carolina is also enjoying this turnaround in the housing market. We have to keep our fingers crossed that this trend will continue, but if it does it’s a big boost for not only housing but the general economy.”