HOUSING FROWNIES FOR 2010?
February 19th, 2010 categories: Buying, Investment, Market Trends, Selling
Usually the Spring selling season begins with the Super Bowl. This year that didn’t quite happen–it actually started in the first week of January. January activity was quite good and February has been a bit slower. Dan Oppenheim, a home building analyst with Credit Suisse, is predicting that we’ll see a strong Spring selling season. He feels that builders are shifting from survival to rebuilding profitability and he also feels that five threats remain:
- The Tax credit will expire–this should give urgency to buyers and help first-quarter sales. What could happen after that is a slowdown.
- Mortgage rates rise. Low mortgage rates have prevailed for a long time. Most analysts expect a rise in rates later this spring when the Federal Reserve stops buying mortgage-backed securities.
- Foreclosures continue. In spite of the government’s efforts, people are still losing their homes and nobody knows when the end will happen. Mr. Oppenheim writes that “The continued supply of foreclosures will mute any improvement in demand.”
- FHA tightens lending. Higher insurance premiums and ecreased seller-provided closing costs will likely cut new home demand between 5% and 10%.
- Jobs. Employment has to improve. People without jobs don’t buy houses.
I don’t mean to end the week on a downer, and I feel we have to look at what is going on carefully. It would be my very greatest plesure to write a post surrounded by wonderful dancing leprechauns–I am going to look for good news and there will be some soon, I’m sure.
Need someone to answer your real estate questions? That is one of the things I do best–just call me. My direct dial is 312-981-2360 cell is 312-607-1306. And there is always e-mail.
Here are a few posts you might find helpful:
Home Affordability–A Balancing Act
Kid Gloves Not Mittens For Today’s Buyer
This entry was posted on Friday, February 19th, 2010 at 2:58 pm and is filed under Buying, Investment, Market Trends, Selling. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
