Out On A Limb

By Spencer Marker
All my beliefs are based on the numbers that I share with you every month and I see them continuing to improve. It does not feel like the market is getting better every day but the truth is in the numbers. I believe that we will see the same trends continue as investors and first time buyers get into the market. This will keep the lower end of the market hopping. The higher end will continue to plod along but eventually we will see more and more move up buyers as the inventory gets gobbled up on the lower end. During the 4th quarter I do not see pricing changing significantly in the lower end and I expect to see some drops in the higher end of the market. There is surplus inventory in the higher end and those that have to sell will lead the market down in price. There is enough demand in the lower price ranges that will will probably not see that occur. All that being said there are some things that could set us back a bit. The first is the tsunami of foreclosures that the powers that be say is coming in the fourth quarter. I was one that underestimated the extent that the foreclosure mess was going to affect our market so I have to give credence to those that say this is coming because they were right last time. BUT, I do see our demand in our LOCAL market exceeding any other market in the country and I think these homes are getting sold now as short sales prior to them going to foreclosure. So, in the spirit of going "out on a limb" I am optimistic that we are through the worst of it and our market is strong enough to absorb what foreclosures we do get and not have them flood our market again. A lot of what is driving the 1st time buyers is the tax incentive of $8000 to buy your first home. That is slated to go away at the end of the year. It is an effective tool that is working so I would hope that it would be extended but you never know. Rising interest rates, more restrictive lending programs, inflation, even rising home values all could have an effect on our marketplace but I do not see that happening. Our local economy is strong and getting stronger, our unemployment is one of the lowest in the nation and we are one of the best areas for job creation. I am confident that the worst days are behind us and we are moving forward. As our market continues to unfold I will as usual keep you informed.