Job losses muddy outlook for U.S. housing comeback

By Tom Brown

MIAMI (Reuters) - A pickup in U.S. home sales has kindled hopes for a housing recovery, but plunging prices, rising unemployment and a new wave of foreclosures are clouding prospects for a quick end to the American real estate debacle.

"We're not at the bottom and anybody that's trying to call the bottom right now is crazy," said Jack McCabe, a real estate consultant based in Deerfield Beach, Florida.

"There's a huge foreclosure wave still ahead in the next 12-18 months and still a lot of excess inventory," he added.

Housing is at the heart of the 17-month-old U.S. recession and is key to a turnaround in the broader economy.

Optimistic observers have been talking about a real estate market strengthening as investors jump in to hunt for bargains.

But upbeat talk is undermined by data like the latest S&P Case-Shiller home price index, which recorded a 19.1 percent drop in the first-quarter compared to the same year ago period. It was the biggest decline in the index's 21-year history.

Nevertheless, the Realtor Association of Greater Miami and the Beaches said on Wednesday existing single-family home sales rose 98 percent in Miami in April from April 2008.

But the surge was fueled by a 39 percent year-over-year drop in median sales prices and many people in Miami -- which ranks among the poorest U.S. cities -- are among homeowners struggling to make ends meet as the U.S. unemployment rate heads into what may soon be double digits.