The year 2010 is not going to be good for the US economy as a whole, if you go by the latest US home foreclosure data for the month of May 2010. Yes, the home seizures by the banks and other lending institutions from defaulters has climbed up to a record 94000 homes in the month of May 2010, due to high unemployment levels.
In the next few months the foreclosure rate is expected to remain high , which in turn would put pressure on the housing price recovery across the country. And that could be a big dampener for new home buyers, for whom the tax breaks also would not be available from next month.
The oil spill in the Gulf of Mexico is only expected to make foreclosures accelerate further, because the house prices are already going down in the Gulf region due to the oil spill.
So the housing sector recovery could be very difficult in the coming months, and further drop in housing prices could only make things worse.
Given the huge budget deficit that the US government is running on, it does not have any scope for providing another round of housing stimulus measures.
So expect the 2010 GDP growth for US to be bad, especially in the second half.
US home foreclosures up by 44%
June - 10 - 2010 - Thursday
