5 things to know about the coming market for 2010

By
Real Estate Broker/Owner with Exit Realty Professionals Portland, Oregon

Here is my prognostication for the coming year's market activity.

1-The tax credit is driving the entry level buyers to get into a house now, with a lot of competition at the bottom price ranges for 3 bedroom 2 bath homes. This will continue through the June closing dates set by congress for expiration of the credits.

2-The interest rates will rise by the spring as a result of the bond market's difficulty finding buyers for long term treasuries to about 7% for a fixed rate loan, whether it be FHA or a Fannie/Freddie product. This will put a have a dampening effect on things until prices adjust accordingly to the new market levels.

3-The 3 and 5 year ARM resets will start kicking in in 2010, and with the rate increases will reset higher than expected, resulting in a third wave of foreclosure activity, with the HAMP program from the feds not having the desired effect of keeping the majority of borrowers who are in trouble in their homes. The inventory will climb from the current levels and the resulting price adjustments will take several years to wash out the overage back to a balanced market.

4-Buyers will continue to look for bargain sales prices and Sellers will need a lot of assistance and advice on the proper choices that will help them navigate difficult financial waters. Professionals will be worth their weight in gold when it comes to buying and selling properties that in prior years would have turned over multiple times in just a few years.

5-Creative prospecting and marketing will reward the diligent Brokers and Agents who will have an opportunity not seen in decades to acquire market share in their areas. Buyers and Sellers have migrated to the internet, yet the face to face ability to listen to what the customer wants and needs will be king in this market.

Now is the time to move to where the market is, rather than where it has been, things are changing on almost a weekly basis, so stay sharp, be aware of your competition and most importantly be aware of what the public is looking for in a professional Real Estate practitioner. The opportunity to prosper is directly tied to the level of creativity and service that we bring to the table!

 

Michael Curtis,CRS- Principal Broker Exit Realty Professionals, Portland, Oregon

www.BoldExit.com www.ExitRltyPros.com Mike@ExitRltyPros.com

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Rainer
27,290
Alix Pinzon
Southern California Mortgage Lending - La Habra, CA
Lic# 1167761

I think you're right on all accounts, particularly about entry level housing.  While the internet is great for many uses, it's too crowded where real estate is concerned, even overwhelming.  I think that people are still weighing heavily on personal contacts and referrals.

Dec 28, 2009 06:21 PM #1
Rainmaker
617,680
Maria Morton
Chartwell Kansas City Realty - Kansas City, MO
Kansas City Real Estate 816-560-3758

Michael, your predictions sound about right to me. Do you remember when interest rates were at 18%?

Dec 28, 2009 06:22 PM #2
Rainmaker
455,178
Dan Tabit
Northstone Real Estate Inc. - Sammamish, WA

Michael, 7% will probably shut down real estate sales completely.  We have been spoiled by these low rates.  I suspect Congress will continue to tamper with incentives like the tax credits. 

Dec 28, 2009 06:37 PM #3
Ambassador
1,856,752
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

Very good predictions. . more likely to occur.

How about this one. .at the end of 2010 we will see the end of the foreclosures and a new beginning for real estate in America

Dec 28, 2009 08:16 PM #4
Rainmaker
4,552,751
Roy Kelley
Realty Group Referrals - Gaithersburg, MD
Roy and Dolores Kelley Photographs

Thanks for sharing. Best wishes for continued success in the new year. Enjoy the holidays!

Dec 28, 2009 09:42 PM #5
Rainer
7,023
Michael Curtis
Exit Realty Professionals Portland, Oregon - Beaverton, OR

Alix, Personal contact and referrals are always the goal, right? A 100% referral business equals a happy Realtor!

Maria, I started my career right at the 18% time, just didn't know any better. Did a lot of private contract sales at that time, and 12% ARMs were common. Then they were illegal, as I remember...hmmm maybe ARMs should have stayed off the playing field, after all...

Dan, I would be surprised if congress gives up another tax credit, mid term elections are on the horizon, and the credit is being used as ammo by the opposition.

Fernando, we can only hope!

Roy, best wishes for you also!

Michael

Dec 29, 2009 07:53 AM #6
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