Although the housing market appears to be in recovery mode, one industry expert says it could be some time before the sector performs at levels recorded at its peak.
Real estate data indicates property values plummeted more than 30 percent in the wake of the real estate bubble burst, and it's expected to take at least two years for prices to appreciate close to previous values, Home Depot chief executive officer Frank Blake told Reuters.
"The way we look at it is there's going to be a period of a workout, a fine period of one to two years and then you're going to get a more robust recovery," Blake said, according to the news source.
Mortgage professionals and consumers should remain cautious about real estate gains, Blake warns. This is especially true for states such as California and Florida, which were some of the hardest-hit markets in recent years. A slight economic hiccup could erase any signs of recovery seen in these states in recent months, he added.
Housing market recovery promising
However, not all real estate experts are on board with this notion. The momentum built throughout the real estate industry during 2012 are too significant to lose speed in the event of a lackluster economy in the near future, according to CoreLogic chief economist Mark Fleming.
Certain variables, such as healthy supply-and-demand, as well as homeowners gaining equity, are at paces experienced at the market's peak just six years ago, Fleming noted in the company's latest MarketPulse report.
"We estimate that 45 percent of all mortgaged homeowners can be characterized as under-equitied, meaning they have insufficient levels of equity to provide a down payment on a traditional conventional mortgage less than 20 percent equity or underwater," Fleming said.
Activity in the housing market is expected to cool in the fall and winter months. Although with average fixed mortgage rates hovering near all-time lows, and property values slowly appreciating, some experts anticipate homebuying to remain elevated as consumers capitalize on affordable market conditions.
However, strict lending standards holding both buyers and homeowners back from taking advantage of these opportunities could be an obstacle, Fleming added.