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Paulson Sees Falling Home Prices as Risk to Recovery, Echos Says

U.S. home prices are unlikely to rebound this year because banks aren’t willing to lend while there’s uncertainty over their rights to foreclose, money manager John Paulson told Les Echos in an interview.

The U.S. needs construction of at least 1 million to 1.2 million new homes a year for a solid economic recovery, Paulson said, according to the newspaper. Less than 300,000 new homes are being built, said the money manager, whose firm, Paulson & Co., oversees about $36 billion.