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The new chief economist Edward Lazear for the Bush administration discussed his viewpoints on the economy with the press today and discussed fears of the housing bubble. I agree somewhat with his assessment, but I do think that there are pockets that have been priced too high and will have corrections. He took a macro-economic view in his press conference and should have gone into a little more detail. But of course, I am a guy with a blog, and Edward Lazear is head of the economic council. So I will defer for now, but snipe if necessary from the sidelines if warranted.

Although some private economists have wondered whether the housing market had become too exuberant, Lazear seemed to downplay those fears.

“If you look at the housing market and say are housing prices going up in regions where job growth is high, where wage growth is high, where demographic movement brings people into the housing market? All of those things seem to be true,” Lazear said. “So if I were trying to explain housing movement by fundamentals, I could do a pretty good job of that.”

Home prices jumped nearly 13 percent from the fourth quarter of 2004 to the same period last year, according to the Office of Federal Housing Enterprise Oversight.

Lazear said it is unlikely that house prices will keep registering gains of this size.

Private economists expect home sales will fall this year as mortgage rates rise. Most economists are forecasting slower growth in house prices this year, although some think prices could fall in some markets

via Forbes.com.

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1. Housing Slow Down Hurting Economy According To Bush Aide
2. Chief Economist for NAR Predicts Future of Real Estate
3. No Bust, Just Fizz as Housing Bubble Fades
4. David Berson, Chief Economist at Fannie Mae is Not Worried About Crash
5. Housing Bubble Burst Blows Away 1 Million Jobs?