But will 2011 be any better?
Having just dusted off my crystal ball, I can now offer my annual 10 predictions for real estate in 2011:
1. Inventories will skyrocket in the spring resulting from sellers who took their homes off the market during the winter hoping to capture buyers in the "spring market" and #2 below.
2. Short sales will increase and foreclosure inventory will continue to rise. The combination with #1 above = huge inventories.
3. Mortgage rates will rise and settle in around 6%+/-.
4. Builders will begin building...slowly, a result of pent up demand for new construction and a loosening of credit by the banks. Many builders have been sitting on land already approved and ready to be built upon.
5. A lot of prospective move-up buyers will continue to stay where they are.
6. The apartment/rental sector will make gains, the result of young Americans seeking escape from family homes in favor of their own living accommodations, but wary of the housing market.
7. There will be no Government Sponsored Entity (GSE) reform of Fannie Mae and Freddie Mac. There will be lots of talk and posturing, but no reform.
8. Prices will stabilize on lower end properties and decline less on higher end properties (over $1.5 million).
9. The term "communication" will take on a new meaning among real estate agents as ever advancing technology allows for better dissemination of information, particularly on cell and smartphones. Tech savvy real estate companies and agents will provide free branded real estate applications (apps) to clients and customers that are cross-platform capable. (For example... Text: RELIST to 87778)
10. Jobs will remain the key to recovery. According to the chief economist for the National association of REALTORS, with a gain of 200,000 jobs per month, a full recovery will take 6.3 years; with 300,000 jobs/month: 3.2 years; with 400,000 jobs/month: 1.2 years. And if we can find a way to create 500,000 jobs per month...well, we will have recovered.
There you have it. Not the rosiest picture imaginable, but we all knew that climbing out of a recession would not be easy... or quick.
The good news?
A lot of real estate transactions will take place in 2011, despite the market. Reasonable sellers, savvy buyers, and tech and service-centered real estate agents will win the day.
Best regards,
Jay Burnham, VP
Coldwell Banker Residential Brokerage
North Shore Real Estate, Massachusetts
Follow me on TWITTER: http://twitter.com/jayburnham
Download my free Mobile Real Estate Search App for your phone.
My prediction is as soon as interest rates begin to rise..........we will see buyers start to scramble.
ReplyDeleteInteresting predictions... I'm just hoping that you're wrong about the interest rates --- love to see them stay lower for at least another year or two... Thanks.
ReplyDeleteLove your thoughts and predictions. Thank You for sharing, Jay!
ReplyDeleteThanks for sharing this information.
ReplyDeleteJay, thanks for sharing your predictions. I do think interest rates will be on the raise but I think they will settle in between 5-5.5%. In the past a raise in the interest to some degree would bring buyers to the market. I'm not sure about that this time around. I do agree it's going to be a good year for the working agent and not the order taker! Happy New Year!
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