Real Estate – Bottom in Sight?

There is good news for everybody, it appears that the real estate market (which is the catalyst of the current downturn) is nearing a bottom. It has to bottom at some point, economies and markets are cyclical after all. Granted this downturn is worse than most, we still have been through this before and we will get through this one. The fact that this one is relatively worse simply means that the relative opportunity is better. There are amazing deals waiting to happen out there!

A notorious bear Dr. Mark Zandi the chief economist of Moody’s Economy.com said “the bottom of the housing downturn is in sight for the nation.” When bearish economists and media pundits are saying that the bottom is near, the bottom is near. Much of the issue with recessions and downturns is that it is a lot of psychology. When day after day Americans hear record foreclosure rates, and home values plunging then of course it is going to get worse. We stop spending and start saving which is simply a consequence (neither good or bad) of living in a consumer oriented economy.

However, we are not only hearing good news but numbers associated with the real estate market are trending upward too. For example in Utah during the last half of 2008 the average number of days a home had been on the market was about 100. In January of 2009 the average number of days a home had been on the market decreased to about 75. Thus, indicating that buyers are slowly coming back to the market because the inventory of unsold Utah homes is decreasing. After speaking with a friend who is a Utah Real Estate Agent with Keller Williams, I am starting to see the turn around first hand as he is starting to get busy and has some deals under contract.

On a national level home prices are leveling off and some of the hardest hit markets are showing relative positive indicators month to month. The Charlotte Observer wrote a piece titled: “Investors targeting bargain real estate.” Again this is very good news as investors will get back into the real estate market before the average home buyer. Investors are looking to take risk in return for reward, average home buyers are typically looking for security.

In Lieu of these recent trends, now is a very fortuitous time to buy a home and with the consumer psychological outlook improving with each positive bit of news it is becoming safer to buy. On top of this we have the stimulus plan which will improve sentiments among buyers. We are also experiencing historically low mortgage rates which will encourage home purchases.

I encourage anyone in a position to purchase a home but waiting out of fear of the market, to stop waiting. Nobody ever accurately predicts when markets bottom. If you wait too long you will have more buyers or competition going after your dream home and you could miss out on the real estate opportunity of a lifetime! Any buyers or sellers in Utah feel free to contact my friend Ron Thurber with any questions 801-860-2049 or visit his website www.utahagent.org and send him an email.