Appraisal Pros Prose

The latest word out of Washington, D.C., last week states that the downward trend in the housing market will continue until early next year!

That consensus is far gloomier than the one just a few months ago, when it was thought that the bottom would be reached in late summer or early fall of this year. But, the economists who convened at the spring construction forecast conference of the National Association of Home Builders disagreed.

The association's chief economist David F. Seiders says, "Foreclosures keep getting worse. Where in the world does it stop?"

The latest S&P/Case-Shiller Home Price Index shows that new and existing home prices fell 12.7% in February 2008 from just a year ago.

For those trying to sell their home, that means adding incentives like seller financing or lease options, pricing their home below the competition (which is nearly impossible with all the bank owned properties on the market!), and marketing aggressively.

But not all economists have such a gloomy outlook on the future of the housing market. Nariman Behravesh, chief economist of Global Insight believes that there is now a substantial amount of capital out there to fix the subprime mess.

And, James Glassman, managing director of J.P. Morgan Chase & Co., believes the current mess is partly due to creditors overreacting to the subprime mortgage crisis, leaving only those with cash saved able to buy homes. He states that the overall economy is sound and the crisis will subside as credit becomes freer and home prices stabilize. "The wheels aren't coming off the wagon," he said.

And, so, take your pick of whose opinion is correct.....and, 'til next time, it's all good!