I recently have had an increase of people all asking the same questions: How long will prices stay this way? When will prices go up? Are prices recovering? What about a recession?
My office is filled with countless spreadsheets, data and just an immense amount of information… There are a lot of perspectives on the economy, housing market, recovery and even mentions of particular letters of the alphabet (W, V, U, L). This all happened before, and learning from those instances could at the least give us some insight on the current situation.
The percentage of people who own their own homes in the area fell to 67.4% during the first quarter, from 69.0% during the fourth quarter and 69.1% during the first quarter of 2009, according to a quarterly survey by the U.S. Census Bureau. The rate is at its lowest point since the third quarter of 2002, when it was 67.3%. The rate peaked at 71.2% during third-quarter 2006.
Many are saying that we could be heading, or are already in a double dip. Historically, there has been one double dip since 1950. Occurring in 1980, it took five years for the jobless rate to return to levels prior to the period. Additionally, nine out of ten recoveries have a slowdown. So the current debate is if we are in that “w” or experiencing a slowdown in the recovery. Additional factors such as unemployment and Europe’s debt crisis could add onto the situation.
So going back to what many clients have asked me, how will all this affect them and what should they do? For sellers looking to hold out, they could face similar market conditions in the future as prices remain stagnant as inventory is addressed in the different neighborhood markets. Additional concerns on future foreclosures coming to market could keep prices low in saturated areas. Buyers looking for long-term ownership are in position for growth, specifically in key markets. Lending could continue to change, especially depending on what happens to Fannie and Freddie. Costs could also rise if the City’s Bond Rating continues to get downgraded.
Sherwin is a REALTOR® in the Chicago & Suburban area with @properties. Questions can be forwarded to Sherwin Sucaldito
”Double Dippin’” by Sherwin Sucaldito is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.
Based on a work at Realty Evolved