The Great Housing Rebound of 2012

By Christopher Matthews TIME Without a doubt, the U.S. housing market has been the most successful sector of the economy this year, and Wednesday’s Case-Shiller home price index report — which showed a fifth consecutive month of year-over-year increases in home prices nationwide — was a late Christmas present for homeowners across the country. The housing market “bottom” was one of the biggest business stories of 2012. After years of falling home values, the data clearly showed that the bleeding stopped somewhere in the first part of 2012, and that home prices have actually begun to slowly rise since then. In addition, other indicators like housing starts, new home sales, and foreclosure statistics all point toward a healing housing sector. These dynamics have gotten some economists and market analysts excited about the growth prospects for the U.S. economy in 2013. Robert Johnson, director of economic analysis for Morningstar, called housing, “the big change factor in 2013,” and believes that “direct housing investment will be a meaningful contributer” to economic growth in 2013. He also sees industries related to housing — like furniture manufacturing and sales — adding to economic growth in 2013 as the housing market begins to pick up.