HomeServices CEO: Housing is Stabilizing

" meantime some good news of the housing market pending home sales surging in September to their highest level in nearly three years. Joining us now to talk about the housing and real estate markets is -- healthy he is chairman and CEO of home services of America. They run more than twenty full service real estate brokerage companies around America run joining us from Minneapolis Minnesota -- Brian did shout with the again. Good to see at Bryant my you know the first question how much of this is related to the homebuyer tax credit."

" Well certainly there's there's so much that can be attributed to the first time credit. For home buyers so but also it's a very low interest rates and I think we're also seeing prying the out. The bottom. Of the housing correction cycle that started as you indicated a minute ago but three years ago. We're starting to see stabilization. And certainly the tax credit is an impetus along with these so very attractive interest rates. And -- the September numbers are are not a surprise but they're certainly encouraging."

" And looks like the extension is coming so last you this though win new extension eventually ends I guess right now the talk about April 30. How much of a drop off is that going to relate to."

" Well I you know if we go back and look I think led the the existing home sales. That we're currently now witnessing are about on an annualized basis about five million existing sales. Which brought us -- we were last debt that around the the turn of this last decade here. But 2000 I think we're we're going to stabilize there we're going to see. Lower prices. Because of foreclosures next year and probably rising interest rates but I think we'll see. Sales continuing on through next year end up five point 15 point two million. You know we've only helped with the tax credit at this point in time. The up the first segment of of the total home buyer population you have the trade up market which has not benefiting really at all. And then of course the luxury market. -- those areas are are still. Barely a week. But the advantage of the first home buyer credit it's it's allowing people to sell their home. At the lower end and find good opportunities in the trade up market."

" The biggest statewide housing market America is in California they've also at some of the biggest problems you guys don't Prudential California realty. The western segment of -- pending home sales number hit a record has the California real estate market bottomed out."

" I do believe that Brian I I think it really started about a year ago. We certainly are are seeing some interest being up phenomenon prices are off substantially from their peak. But I think we've hit the tipping point there is still substantial demand if prices are right and and interest rates are affordable. The affordability indexes have really had an all time high. And we're seeing sales activity that has continued to grow in substantial numbers since January. And so I again I do believe what we are witnessing is is sort of the end of the housing correction cycle. Now we'll start to see stabilization. Between now and next year. Okay we got all these arms though that are going to reset basically from two months ago through June of 30. What is maybe that's it what is the biggest risks though right now to a housing recovery -- Well I think I think the real risk is that we are going to see Brian. The the I'd trade up and higher end home from going to see more foreclosures. The first wave was in the sub primary of largely. Lower priced homes the second wave that we're going to see that would just start. Early to -- will be higher priced homes. And I do think that that will cause overall the average sales price. -- to to further degrade but I at the end of the day I think sales activity in terms of -- home sales. Probably going to stabilize at about 5000005 point one it's just going to be a different mix of sales lower priced homes will sell. More aggressively than the mid to high end homes but if it's it's still providing. A substantial opportunity for a state like California we're just a couple of years ago. About 80% of the people could not afford the home that there -- so where we're seeing. Really a once in a lifetime opportunity for many would be homeowners to get back in the market. -- delegate chairman and CEO of home services corporate America Ron always a pleasure thanks for joining us on Fox Business. Yep thank you right right."