Meredith Whitney, the famous financial pundit, expects a second leg down in the U.S. housing market.

I think this is certainly plausible with all the pending foreclosures overhanging the market. However, I think in many areas of the Phoenix real estate market prices are so low already that those sub-markets can clear the additional supply without lower prices, or significantly lower prices, anyway. However, a double dip would bring down prices in areas of metro Phoenix that haven’t seen their home sales per month return to “normal” (early 2000s) numbers.

Don’t forget that Arizona is not the United States. Arizona will likely bottom out before the rest of the country and we could become a bit of a “safe haven” for investors a year or so before the United States as a whole starts to bounce back. In that case, it’s not the absolute strength of Arizona’s economy but it’s relative strength that will draw investment, including real estate investment.

ADDED: Cool! We got a link from Bigger Pockets!