Forecast for 2009 real estate market still sluggish

Mixed Results for Existing-Home Sales; Mortgages Improving

Single-family existing-home sales were stable in October while the condo sector was down, according to the National Association of Realtors. Lingering effects of the credit crunch were a drag on sales but the mortgage situation has improved significantly.

Total existing-home sales -- including single-family, townhomes, condominiums and co-ops -- eased by 1.2 percent to a seasonally adjusted annual rate of 4.97 million units in October from a downwardly revised level of 5.03 million in September, and are 20.7 percent below the 6.27 million-unit pace in September 2006. Continue reading...

Mortgage problems will continue to hamper pending home sales

Pending sales of existing- homes activity will be dampened near-term as mortgage disruptions continue to impact the housing market, according to the National Association of Realtors( R). The Pending Home Sales Index*, a forward-looking indicator, fell 6.5 percent to a reading of 85.5 from an upwardly revised 91.4 in July, based on contracts signed in August. It was 21.5 percent below the August 2006 index of 108.9. Continue reading...

Tucson, AZ real estate market shows moderation

The whole mortgage mess is turning into a real made for TV political extravaganza. And, with the elections a year away many things can happen. The government wasn't going to bail out anyone and inflation was the big concern. Now, the politician's are tripping over each other with ways to solve the financial problems.

The local real estate market from my point of view is still moving, albeit slow. I have written a few deals recently and the sellers seem to not want to face reality and lower their price, or they don't watch the news. I spoke to a couple of appraisers and they agreed that this market is just as hard as couple of years ago when the market was on a rampage.

When the Tucson, Arizona real estate market was red hot 25-40% of the sales were to investors. Now the market is slowing down and my guess is the majority of investors are out of the market. It's back to a real market where buyers are buying homes to live in and enjoy. Continue reading...

2008 Housing Forecast Changed Slightly Due to Impact From Tighter Lending

Housing activity this year will be somewhat lower than in earlier forecasts, with clearer analysis of the effects of stricter lending standards and a decline in subprime mortgage origination, according to the latest projections by the National Association of Realtors (R).

Lawrence Yun, NAR senior economist, said one benefit for the market is the disappearance of speculative behavior, which contributed to abnormal price growth. "Home buyers today are purchasing for the long-term, generally with a realistic expectation of modest gains over time," Yun said.

"Housing first and foremost is shelter. Second, it's a long-term investment that slowly builds the greatest amount of wealth for most families. It's good that we're getting beyond the tendency of some buyers to view housing as a temporary asset to accumulate short-term wealth, which is not to be expected in a normal market."

Existing-home sales are likely to total 6.29 million this year and 6.49 million in 2008, compared with 6.48 million last year. New-home sales are projected at 864,000 in 2007 and 936,000 next year, lower than the 1.05 million in 2006. Housing starts should total 1.46 million units this year and 1.52 million in 2008, down from 1.80 million last year. Continue reading...