| Market Assessment - Big Picture | October 22nd, 2008 |
|
If you want a STRONG opinions about current economic conditions and how they affect our local real estate values, then Carole is your gal. Here are some of her remarks regarding our current economy and real estate inside and outside the Bay Area: Yes Virginia, we are in a recession. While we haven’t seen negative growth for two consecutive quarters, it’s been stimulus packages from the government that have kept us afloat. The market is still correcting and we can’t say for sure when it will go back up. We know we’re presently in a downward trend, but we’ll only know when we’ve hit the bottom when we start going up again. There are positive signs that we nearing the bottom. The number of real estate sales is soaring in entry level markets. Oil prices are down. And we have solid growth in consumer segments of the stock market with companies like WalMart, Kraft and Proctor & Gamble. The bailout will loosen lending restrictions, which will bring more buyers into the market. The government is pouring money into the banking system both as an investor and a lender. This influx of cash will take time to shake its way through the system, but Rodoni predicts that real estate loans will be easier to obtain by Q2 of 09. If Rodoni had to make a guess, she’d say the market will continue to waffle until mid-09. When measuring prices nationwide, there could be a 20-25% correction, but we may already be 3/4 of the way there. Things Buyers should consider - LOCATION is still the most critical factor when purchasing real estate. This seems like a bonehead observation, but we should always remember that property holds its value best in locations that are highly sought after. This is why real estate in Pacific Heights is outperforming real estate in the Excelsior District. It’s also why the San Francisco real estate market is outperforming the rest of the Bay Area. A correlation to this observation is that every market segment in San Francisco is a micro-economy. The condo market on the Van Ness corridor is completely different than the single family home market in Noe Valley which is completely different from the new homes market. So beware of comparing apples to oranges. Things Sellers should consider: You may want to wait if you don’t need to sell right away. If you have to sell, you need to face the fact that you won’t make a killing in this market. You CAN, however, take heart by looking back on what you’ve accomplished financially and emotionally during your period of ownership– appreciation, tax benefits and personal enjoyment should help you arrive at a ’glass half full’ conclusion. If you are selling with an intention to buy something else, then you need to become a Buyer ASAP! You will get as good a deal on what you buy as what your Buyer did with your homes. You can even make out like a bandit if you move to an area where prices are dipping more than the neighborhood you moved from. Leave a Reply |
|
|
|
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
Today I attended a brief seminar given by Carol Rodoni– a past COO of Alain Pinel Realtors and real estate industry leader. Carol is highly opinionated and highly entertaining. She constantly studies the economy and chatters about facts and statistics faster than ticker tape.