Speech Governor Randall S. Kroszner At the Federal Reserve System Conference on Housing and Mortgage Markets

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Governor Randall S. Kroszner
At the Federal Reserve System Conference on Housing and Mortgage Markets, Washington, D.C.
December 4, 2008

Improving the Infrastructure for Non-Agency Mortgage-Backed Securities

I very much appreciate the opportunity to participate in this conference and to hear your insights firsthand about such a range of important topics.

As you know, housing markets are weak. Sales of new homes and of existing homes are well below their respective peaks around the middle of this decade. House prices have fallen sharply--the national price index published by the Federal Housing Finance Agency is down almost 8 percent from its high in the spring of 2007, and the Case-Shiller national index is down more than 20 percent from its peak about 2-1/2 years ago. Residential construction has remained weak, with single-family housing starts having declined to less than a third the number seen early in 2006. Even with the drop in homebuilding, the inventory of unsold new homes represents more than 10 months' supply at the recent pace of sales. Taken together, these data suggest continuing near-term challenges for stabilization of the housing market

Full article here.