Consumers key for home market upturn

Even though data suggests the worst is over in the housing market, Neil MacKinnon, chief economist of the ECU group, told CNBC he believes the bottom has not yet been reached, since lending conditions are still tight, a sizable inventory of unsold houses still remains, and unemployment is high. “The American consumer is key to complete improvement, as they constitute 20 percent of the world’s economy,” said MacKinnon. He said if unemployment levels continue to increase, there is a risk that the consumer might not come back, which means housing would continue to plunge. He predicts that it will be some time before there will be a serious upturn in residential investments and he foresees a slow recovery for the housing market.