Pimco Housing Bear Kiesel Says It's Time to Start Buying

By John Gittelsohn-May 4, 2012

Mark Kiesel, the Pacific Investment Management Co. managing director who sold his home in 2006 when he deemed the market a bubble, says it's time to buy.


"I was one of the most negative on housing," Kiesel said in a telephone interview. "I finally came to the conclusion housing is looking pretty decent."


Kiesel said he bought a house in Newport Beach, California, where Pimco is based. Today he published a credit market note titled, "Back In" on the firm's website in which he writes, "I'm not sure U.S. housing prices have bottomed--only time will tell--but there are many more positives today than there were six years ago when I sold my house."


Home prices that have fallen 35 percent from their mid-2006 peak and mortgage rates of less than 4 percent are helping make it a good time to buy, said Kiesel, who is global head of the corporate bond portfolio management group at Pimco. Other signs the housing market is turning around include forclosure filings dropping to levels last seen in 2007 and sales of new and existing homes that have begun to increase as rising rents boost the relative affordability of purchasing, he said.


"For those of you renting or on the sidelines, I recommend you at least consider getting 'back in' and buying a house," he wrote in the note. "The future is hard to predict, but U.S. housing is healing and is probably close to a bottom."


http://www.bloomberg.com/


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