The housing downturn that became increasingly apparent by 2006 and then worsened considerably thereafter arguably represents the primary contributor to the 2007-2008-2009 recession. During the early years of recovery, the housing market helped to pace the economic expansion, driven in large measure by a combination of bargain basement prices and record low mortgage rates.
There are many economists who predicted that the US gross domestic product would expand in real terms by 3 percent or better in 2014. Those forecasts depend on many things going right, including ongoing recovery in the nation’s housing market. But just when many economists expected the housing market to gather momentum due to broader economic improvement, the US housing market appears to be losing steam. Sales of existing homes fell 7.5 percent in March from a year earlier and to the slowest pace recorded in 20 months. Purchases of new homes fell 14.5 percent from February.