Goldman Sachs’ chief U.S. economist Jan Hatzius was on CNBC shortly before noon to talk about his economic outlook for 2012 and Goldman’s recent assertion that the housing market is near its bottom.
Like his last appearance on CNBC, Hatzius reiterated that he believed that economy in 2012 will be just as sluggish as in 2011—if not more slower in the the first half of this year—citing U.S. exposure to the instability in the Eurozone as a continued concern and adding that Europe was already in a “deep recession.”
In line with recent bullish data on the housing market, Hatzius said he believed that housing starts have already hit bottom and the volume of building will soon pick up as demand increases. As for housing prices, the bottom is in sight but will come much slower, Hatzius said.
“Based on the fact that the mis-evaluation bubble in 2006 has disappeared, we now think housing is fairly valued. We still have some small declines for house prices for most of this year because of excess supply that’s still out there. But we’re pretty confident that we’re fairly close to the bottom here just based on the valuation and based on the fact that excess supply is coming down.”
Here’s the video of the interview, which was with CNBC’s Gary Kaminsky and broadcast from Goldman’s HQ at 200 West St.