Real Estate and some otherwise…
For those that are interested, here are the predictions I made for 2008, as well as a wrap-up post about the results. I was right on 6½ of the ten real estate predictions… So here are the predictions for the coming year…
- I’m looking for slightly lower mortgage rates through the first half of the year, and then a rise starting by the third quarter. Going WAY out on a limb, I would say that there will be rates under 4.5% (without paying points) at some point before July…
- Credit is going to loosen, but don’t expect 2005… It is actually moving in that direction already.
- I’m looking for the inventory levels to decrease compared to 2008… I’d like to see them drop 20% from 2008. I think we will hit that target through the first three quarters (the end of 2008 was already trending down).
- Foreclosures ARE going to increase, but they are NOT going to go up to the levels hyped by many in the media. Some of the media are calling for doubling or tripling foreclosure rates… I expect that the foreclosure rate will go up less than 50% compared to 2008. As of November 2008, one of 234 properties is foreclosed.
- I’m looking for prices to drop a little more in Gwinnett County through the year. There might be stability in the 2nd quarter, but drops in the 1st and 3rd for sure. I expect that the drop will be less than 10%.
- Sales volume will post a slight increase for 2009. I expect the 2nd quarter to post the strongest gains, year over year.
- I think there is a good chance that the $7500 First Time Home Buyer Tax Credit will be extended… and forgiven. I’m not positive on this one, but I know that there are a lot of folks on Capitol Hill making noise about this one.
- On a national basis, the media will start reporting positive news about the real estate market. As much as the NAR is annoying by trying to spin everything as wonderful… there is a grain of truth. Inventories are up, prices are down and loans are cheap for those that qualify.
- Technology will be moving even more front and center in real estate sales. Right now only about 4% of agents have a blog. Only a fraction of those are actually posting to it regularly… and only a small portion are on services like Twitter, FaceBook and LinkedIn.
- The financial crisis will deepen. Unemployment will go up and things will be looking grim despite at least two more “stimulus packages” from the Democrat Administration. They won’t work because they won’t be targeted for those that actually create jobs.
And I also wanted to toss in some bonus predictions:
- Red Wings and Bruins will go to the Stanley Cup Finals… Bruins in 6 games.
- NY Islanders will be at the opposite end of the stats… Thrashers close behind.
- Chrysler will NOT be an independent car company at the end of the year (or will at least be VERY targeted by either Nissan or Ford). Everyone will expect GM to buy them, but they already have too many brands, and extending that with Chrysler will be seen as a bad move.
- Look for Saturn and Hummer to either get sold or shuttered.
- Look for Toyota to extend their losses into at least two quarters of 2009… and post a loss for the first year.
- Finally, 2009 will extend the cooling cycle of Earth. Global Warming fans will try to spin it, but there will be a LOT more attention paid to the fact that global temperatures peaked in 1934… and had a lower peak in 1998… and have been moving steadily down since 2006.
Of course I will revisit this at the end of 2009.