Existing home sales picked up for the month of July, but it is it enough to say that the market is finally starting to recover? Will potential homebuyers see some relief soon?

Morgan Stanley US housing strategist and co-head of securitized products research Jim Egan joins Market Domination to give insight into the challenges that make the housing market recovery difficult.

Egan points out "four pillars" that are in the way of a housing market recovery, one of them being affordability with mortgage rates being too high: "6.5% is high relative to where we've been over the course of the past decade. It's also very high relative to the mortgages that are outstanding in the housing market today," claiming the average is about "sub 4".

"It makes it too expensive for people to feel like they can move. And it's still just if we look at what the median payment is on the median household right now, given where mortgage rates are, we're still talking about for first time homebuyers who aren't locked into those low mortgage rates, it's still less affordable for them to buy than it's been at any point, really, in the past 30, 35 years." says Egan

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This post was written by Nicholas Jacobino