A business associate of mine, Robert E. Toffel from USA National Title, shared his article with me concerning the usual beginning-of-the-year predictions that are surfacing in the real estate world.
If there's anything to be learned here it's 1) improvement has been predicted, 2) decline has been predicted and 3) since both improvement and decline have been predicted, it's best to make educated decisions to take care of your own real estate needs. You can find opinions to back any side of the equation, so focus on your needs and the best way to handle them.
That being said, here is Robert E. Toffel's article with some really eye-opening points that I believe will help you keep your real estate market in proper perspective:
As the new year begins, there is no shortage of stories telling us what to expect in 2012. Housing finished 2011 with momentum and mortgage rates closed at the lowest rates of all time. Some expect those trends to continue through the first quarter and beyond. Others expect a rapid reversal. Who’s right and who’s wrong? A quick look through the newspapers, websites and business television programs reveals “experts” with opposing, well-delivered arguments views. It’s tough to know who to believe.
For example, here are some “on-the-record” predictions for 2012 :
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Home prices will rise in 2012 (says Freddie Mac)
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Home prices will fall in 2012 (says CBS News)
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Mortgage rates will rise in 2012 (says American Banker)
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Mortgage rates will fall in 2012 (says the LA Times)
The issue for buyers, seller, and would-be refinancers in Orange County and nationwide is that it can be a challenge to separate a “prediction” from fact at times. When an argument is made on the pages of a respected newspaper or website, or is presented on CNBC or Bloomberg by a well-dressed, well-spoken industry insider, we’re inclined to believe what we read and hear. This is human nature.
However, we must force ourselves to remember that any analysis about the future — whether it’s housing-related, mortgage-related, or something else — are based on a combination of past events and personal opinion. Predictions are guesses about what might come next — nothing more.
For example, at the start of 2009, few people expected the 30-year fixed rate mortgage to stay below 6 percent, but it did. Then, at the start of 2010, few people expected the 30-year fixed rate mortgage to stay below 5 percent, but it did. All we can know for certain about today’s market is that both mortgage rates and home values are low, creating favorable home-buying conditions in and around Southern California and nationwide. At that start of last year, few people expected mortgage rates to even reach 4 percent. Today, rates “with points” price in the 3s. What 2012 has in store we just can’t know.
As always, for more help and hints, just call me...your Beach Areas Specialist at 562-244-8021, visit my Beach Areas Real Estate Specialist webpage or visit me on Facebook.
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