Housing Recovery May Not Start Until 2010 or 2011, Barrons

NEW YORK (Reuters) - U.S. housing prices may not start recovering until 2010 or 2011, according to a Barron’s report that quotes bond fund manager Jeffrey Gundlach.

The report in the October 1 edition cites a Gundlach forecast that U.S. home prices may drop an average of 12 percent to 15 percent annually and not reach a trough until late 2008.

According to the report, Gundlach sees particularly sharp declines in bubble markets of California, Florida, Nevada and Arizona and areas in Michigan, Ohio and Indiana, with price drops of 30 percent to 40 percent in those areas.