Tilson: Housing Recovery a Costly Mirage

Monday, October 19, 2009 10:02 AM

By: Julie Crawshaw

T2 Partners Whitney Tilson says the apparent housing recovery is only setting us up for worse things to come.

"The rebound has been stronger than we've anticipated," Tilson told Yahoo! News.

Yet he remains "confident this is the mother of all head fakes."

Tilson attributes the housing upturn of the past few months to low interest rates, first-time homebuyer tax credits, falling prices and seasonality — not improving market fundamentals.

He also believes there's still supply and demand issues that will hamper the recovery.

“The total inventory is triple what's actually being reported," says Tilson, who estimates there are twice as many homes in foreclosure or near foreclosure that aren't for sale yet.

Though Tilson doesn’t foresee “anther calamity to comeâ€