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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: David Jones who wrote (955)	10/29/2001 2:36:41 PM
From: David Jones	Read Replies (1) \| Respond to of 306849

Another opinionated article and a note from yours truly. I learned a great deal about business from my mother. 25 or more years ago she said this country will one day become the "haves and the have knots". Reminding me the middle class in the fifties were those that owned their homes out right. Not many can say that today. Is the middle class expanding or contracting? Or is it an out dated concept? I can't tell ya but it has motivated me. Another thing mother would say that cracked me up was when quoting a asking price for a piece of property was. "It may not be worth that today but it will some day" She was a woman that played her investments LONG.) "if by chance your thinking I have a silver spoon sticking out of my mouth or some other orifice? Think again. After high school my father told me there isn't enough money in the family business for him and my older brother so I'd better find something else and not much has changed sense" list.realestate.yahoo.com Monday October 29 9:22 AM ET Market Decline To Be Moderate, Say Economists Lew Sichelman, Realty Times Columnist The impact of the terrorists attacks of Sept. 11 on the nation's housing market won't be terribly severe, say economists speaking for the three major residential real estate disciplines -- home building, general brokerage and mortgage finance -- predicted last week. David Seiders of the National Association of Home Builders has scaled back his forecast through the second quarter of 2002. But he expects the biggest hit in the fourth quarter of this year, when housing starts will total just 1.45 million on an annual basis or about 10 percent below the NAHB's pre-911 forecast. David Lereah of the National Association of Realtors also predicted a rather short-lived downtown. Noting that sales and listing activity is already back to 95 percent of normal after grinding to a virtual halt for the first few days after the attacks, he anticipates that housing "will pick itself up and go right back to where it was three or four months ago." David Berson of Fannie Mae predicted a "fairly quick recovery" as well. Overall, he said housing sales should be off only about 5-6 percent at worst "from peak to trough." And that, he offered "is a very small decline." The three economists made their predictions at a press conference at the recently remodeled and expanded NAHB headquarters building, the National Housing Center, in Washington. It was the first official event at the refurbished structure, and it was called to provide an up-to-the-minute report on the state of the housing market. All three hedged their bets somewhat. Seiders, for example, said he's never seen such a degree of uncertainty about where the overall economy in general and housing in particular are heading in the short-term. And warning against leaning too heavily on history as a guide, Lereah said "we're in unchartered waters." For September, NAR said existing single-family home sales fell nearly 12 percent to a seasonally-adjusted annual rate of 4.89 million units, 5.2 percent below the 5.16-million unit pace in September 2000. But noting the critical importance of housing to the economy -- something on the order of 20 percent of the gross domestic product can be attributed either directly or indirectly to housing -- the economists nevertheless expect housing to once again lead the nation into recovery. "We have seen tough times before and we have always rebounded and led the economy to a higher ground," said Bruce Smith, the Northern California custom builder who heads the NAHB and has been through three major recessions during his career. Unlike previous downturns, Smith, who moderated the 90-minute briefing, also pointed out, this one is taking place at a time when most of the major indicators favor real estate. While past recessions have been marked by high interest rates, overbuilding and weak monetary policies, he said, mortgage rates are their lowest in three decades, inventories are low and the Federal Reserve Board is acting aggressively. "We've never seen anything like this," the California builder said. "It's a dynamic that's never existed, and it bodes well for housing." Even the houses that won't be built or sold as a result of the terrorist attacks and the ensuing anthrax scare won't be lost, Seiders, the NAHB economist, ventured. They'll just be postponed, he said, explaining that "for housing, transactions that lost in the short term because of economic problems or shocks to the system generally are regained down the line." Indeed, in recognition of what he called "the durable demographic foundations of the housing sector," Seiders as upped the ante for housing starts in 2003, raising his original forecast by 50,000 to a "hefty" 1.684 units. If he's right, half the 100,000 houses that won't be built because of the attacks will be in the ground within 27 months. New home sales, says NAHB, dropped to a seasonally-adjusted annual rate of 864,000 units in September, a 1.4 percent decline from the August rate of 876,000 units. Predicting the "smallest downturn of any recession in the post war period," Berson of Fannie Mae said the effect of the recession on housing will be negative "but not very negative." And for the decade as a whole, he offered, the next 10 years are "likely to be the strongest ever."