There are a lot of sighs of relief now that 2009 is past, particularly coming from the real estate industry.
But will 2010 be any better?
I have just dusted off my crystal ball... and I can now offer my annual 10 predictions for real estate in the coming year:
1. The residential housing market will pick up early this year, but will dip again after mid-year.
2. Short sales will increase and foreclosure inventory will continue to rise.
3. Mortgage rates will rise and settle in around 6%+/-.
4. Appraisal guidelines will tighten and mortgage lenders will require stellar credit from buyers.
5. A lot of prospective move-up buyers will stay put.
6. Commercial real estate will continue to decline.
7. Builders will continue to be cautious and not in any particular hurry to gain project approvals or begin construction.
8. New construction prices will drop significantly.
9. Prices will continue to decline on higher end properties (over $1.5 million).
10. The terms "communication" and "service" will take on new meanings among real estate agents with the need for more direct contact with clients, such as phone and face-to-face contact as opposed to Internet, email and voicemail communication.
There you have it. Perhaps not the rosiest picture imaginable, but no one said that climbing out of a recession would be easy... or quick. Take a look at the graph below and you will see why. I would put us somewhere between the "depression" and "hope" positions of the graph.
The good news?
A lot of real estate transactions will take place in 2010, despite the market. Reasonable sellers, savvy buyers and service-centered real estate agents will win the day.
Carpe Diem! Make it a great year!
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