Housing Market Outlook for 2008

Is the housing market going to sink or swim in 2008? The Real Estate Journal provides a roundup of opinions on this vital part of the U.S. economy. Thomas Kostigen of MarketWatch is optimistic. "At the first blush of renewed energy, the real estate market will bounce back," he says. On the other hand, Bankrate writer Steve McLinder advises homeowners to "wait it out."
Posted on January 7 at 10:05 AM Permanent Link

Impact of Foreclosures
According to RealtyTrac, foreclosures are increasing in the top 100 metropolitan areas for the third quarter. Stockton, California had the greatest increase foreclosures, 32% rise from the last quarter. Other areas with an increase in foreclosures include Detroit, Riverside-San Bernadino, California , Fort Lauderdale, Las Vegas, Sacramento, Cleveland, Miami, Bakersfield and Oakland. "When foreclosure can’t be avoided, the losses extend beyond the borrower losing a home. The foreclosure process typically costs lenders added legal fees, taxes due until the property is sold and lost equity in a house that must be priced to sell in a falling market. The added inventory of unsold homes further weakens local housing markets, depressing the value of other nearby homes."
Posted on November 15 at 11:27 AM Permanent Link

2008 Revival?
Craig Guillot of Bankrate.com thinks "the residential real estate market shows signs that demand is building and home values may start recovering in 2008." With home sellers cutting prices and builders getting rid of excess inventory, bargain hunters may snap up those houses. "While the housing downturn may not be good for the overextended homeowner or mortgage lender left holding the bag, many economists agree that it is healthy to make a transition to a housing market driven on fundamentals instead of speculation. "
Posted on November 8 at 11:09 AM Permanent Link

When will the housing slump end?
The end of 2009, says the Mortgage Bankers Association, according to Realty Times. [Doug Duncan] says that existing home sales for 2007 will be about 5.72 million units for a 12 percent decline from 2006, and that existing home sales will slump 10 percent further before they pick up by five percent in 2009." Meanwhile, the National Association of Home Builders says "While there's no question that the housing downswing continues to be played out in markets across the country, today's numbers show that builders are pulling back on production until sales improve," says Seiders, "This is exactly what our latest builder surveys have told us. We do expect some additional downward movement in housing production going into next year, at which point starts should begin to stabilize as sales turn upward in the second quarter."
Posted on October 18 at 10:07 AM Permanent Link

How is the economy and new home size connected?
According to the Wall Street Journal Online, home builders are offering smaller homes due to the problems in the housing market. "Financing has tightened down so much that many people aren't able to qualify for the larger houses," said Kathryn Boyce, an account executive in Northern California for Boston-based real-estate research firm Hanley Wood Market Intelligence. "Throughout the U.S. people can't afford what they previously did. Floor plans are going to get smaller." Many homebuilders are scaling down the size of their McMansions due to affordability.
Posted on September 25 at 02:47 PM Permanent Link