In the article a few days ago titled – Foreclosures smack home prices – down 29.3%, you should find a silver lining if you read it. (please click title link.)
The key part here is what Rosen (well known and respected for his thoughts on the housing market) had to say –
“In 18 months, prices will go up 3 to 5 percent. The DataQuick median series will show a big jump when the foreclosures stop; it will look like they go up 15 to 20 percent. That’s not because house prices will have surged but because the data won’t have all these foreclosures.”
So, it won’t be a lot, according to Rosen, but things should be geared to go up 3-5% in about 18 months. Where is that according to the election year/change of presidency?
My thoughts? I’ve seen some areas in San Francisco go down, but I’ve definitely seen some go up. (Condos seem to be doing pretty well… the areas Bernal and Mission, etc.) A lot of people say that two years from now, many mortgages are geared to change again as a wave of fixed APRs become variables, and that will surely lead to another crisis. Though, I’m hoping and positively thinking that my buddies at Freddie… and the government, let’s say the next president… will get in line some new measures to adequately address these issues. In that case, Mr. Rosen should be on the right track.
Either way, I worry for my clients (the buyers) that they will miss the bottom of the market slope waiting for things to get worse… and one day they will realize that prices are up again and staying that way. I cannot foretell the future, and I don’t know when that time will be. …but please watch carefully and make sure not to miss the down slope if that’s what you’re going for!