Thursday, January 20, 2011

Report on International Builders Show in Orlando

At the recent Builders Show in Orlando, there was plenty of pessimism, but glimmers of hope.
Two housing economists, Frank Nothaft, chief economist for Freddie Mac and David Crowe, chief economist of National Association of Home Builders (NAHB) were optimistic. Nothaf predicted a 20% rise in home building for 2011. Both economists acknowledged that any increase would be starting "off a really low base."  Crowe forecasted slow but steady growth going forward that will build momentum.
Both agreed that the housing economy has bottomed out.  They named several key indicators, including low mortgage rates, lower asking prices for new and existing houses, and marginally better numbers in the economy as a whole.  They agreed that it would take "at least" two more years before there is a balance between buyers and sellers.

Other positive factors mentioned are:
  • Homes are affordable and mortgage rates are the lowest "since the 50's".
  • There is pent up demand for new rental units and rents are stable or rising especially "for professionally managed large properties" according to Nothaft.
  • There is pent up demand of 2,000,000 household that were not formed because of the economy.
  • Younger people are staying longer with their parents who would have normally have formed households.
If you would like to purchase a new home this year in New Jersey, call or email me and let's discuss your options.

Joe Giancarli, SA
Real Estate Advisor

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