As the President-elect of the Porter County Builders Association I have the opportunity to see a glimpse of what's going on countywide. I got an email late last week asking for my interpretations of the market for new homes here locally. This is a reprint of the response I sent.
I believe that 2007 will be a very solid home building year for Porter County. I know that I'm expected to say that, but I can honestly report my projections. I was also honest in 2005 in my feeling that new homes would decline, I did not expect 25%, that was a bigger decline than I expected.
A couple things that lead me to project so much more activity in 2007:
- In 2006 we underbuilt the demand. Our projections would have been for 200 more homes demanded in 2006 and frankly builders got nervous and slowed way down.
- As the Post suggested a couple days ago, home values did not decline. They are expected to increase even more in 2007 by at least the 3.7% that the paper projects.
- There a couple terrific new neighborhoods that just didn't get rolling in time last year. I think people will love them and flock to build.
- Interest rates will remain level or even go down a little in the second quarter, our most powerful selling season.
- The home buyers I've talked to in even the first 10 days of this year are much more ready to purchase than at any time last year. I know it's subjective, but we all use our gut.
What could go wrong, let's be honest:
- Well frankly we have some municipalities that have gotten carried away with extra fees, Valparaiso and Portage have increased some pretty fake fees by thousands. This has an adverse impact on the first time buyers for sure. If they continue to raise fees, less people will buy entry level.
- We could lose a major employer. I don't think this will happen, but jobs are the fuel that drives the economic engine in our region.
- There are still too many specs. A good run on spec sales would be good for buyers and sellers alike. But if they sit, they hurt the whole market. One major builder dumped 30 plus specs last year and no one has that many going into this year.
All in all, I expect pretty amazing things this year. Are you ready?
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You are right, Steve. Builders will keep building as long as there is that last dollar of profit in building. BUT 2007 SURE WON'T BE A GOOD HOME SELLING. HAHAHAHA!
Now I have a few words to say in reply to your post a few days ago about creating urgency to buy:
To my team I say "It's high time we go back to providing solid advice to our client." It is never a good idea to wait around to buy. Rates and prices and costs and taxes and insurance all go up.
that's BS, not solid advice. if you didn't notice, prices do not always go up. PRICES ARE FALLING IN 90% OF THE COUNTRY. you ran out of those greater fools last year.
To REALTORs everywhere I say "Join with us to take back control of the rumor mill and gossip channel." We know that there are thousands of people sitting on the sidelines. Let's get them back in the market for their own good, and of course ours as well.
HAHAHA! this is a GREAT Freudian slip. Yeah, let US run the rumor mill. Let OUR RUMORS of market going up and up and up be the one ruling the roost. "...their own good, and of course ours as well." Indeed! Go generate me some COMMISSION CHECKS. what are you gonna do next, steve? hand out Glocks so your sales team can hold the gun to the buyers' heads and force them to cut your ilk the 6% check?
My God, you Realtwhores must be really delusional to even THINK of saying stupid drivel like this.
PDXrenter (not a homeDEBTor)