Optimism on housing

I just finished telling KPCC listeners that the real estate recovery is likely to be veeery slow, noting the various forecasts that show price gains next year in the 2-3 percent range. So along comes economist Mark Schniepp predicting that by 2012, Socal home prices (strangely excluding L.A. County) will be up 30 percent from their lowest rates recorded earlier this year. How does he reach that conclusion? Mostly, it's just a whole lot of optimism about where the economy is headed. Here's a nugget (h/t OC Register's Jon Lansner):

Prices bounce up because distressed sales no longer dominate the mix of sales and therefore the median selling price after 2009.

Sounds like he's discounting the potential impact of more foreclosures in 2010, an awfully frisky forecast. Schniepp's views are at odds with most economists out there - and for good reason - though the contrarians sometimes have the last laugh.