Real estate forecasts made by industry associations, economists, homebuilders and consultants for the year 2009 point to the same realization: 2009 will still be a bleak year for the home building industry due to continued foreclosures and slow sales of home foreclosures.
The North State Building Industry Association and the California Building Industry Association both see 2009 as a bleaker year than 2008 because of the economic downturn and banks’ continued home repossessions which have been constraining sales.
Mike Davis of real estate auctioneer Zetabid also predicted that there will be more house auctions in 2009 despite loan modification and foreclosure prevention measures launched in 2008. He said that there is so much inventory of foreclosed homes that auctioneers’ operations related to foreclosed properties will continue up to two or three more years.
Building industry analyst Greg Paquin studied real estate figures and came out with the following forecasts:
- New house prices will average only $374,000 across Sacramento and surrounding cities.
- Homebuilders will sell only 5,300 houses in 2008 in the counties of Sacramento, Sutter, El Dorado, Placer, Yolo and Yuba counties.
- The housing markets that will recover faster than the others will be Placer County, El Dorado Hills and Folsom.
The behavior of interest rates on mortgage is expected to remain volatile as they have been going up and down as economic news reports are released. According to Freddie Mac economists, rates fell when news reports of declining levels of consumer spending and job numbers and increased foreclosures were released. Comstock Mortgage issued its observation that rates fell by one-fourth of one percent in a span of only few hours in one particular weekday.
In the meantime, a survey by Mortgage Bankers Association in 2008 showed that borrowers have become cautious in their approach to mortgage loans. The percentage of subprime loans across the U.S. has declined to 3.8 percent, much below the 20-percent level in 2005 and in 2006.
Email This Post
Print This Post
HUD Fair Housing Equal Opportunity
