Expert Panel See’s Little Hope for 2009
Thursday, January 8th, 2009
Inman News, a leader in real estate news and publishing, is hosting its annual Real Estate Connect Conference in New York City this week.
On Wednesday, a well respected panel of industry experts sounded off during a “Bulls vs Bears” discussion of the real estate market in 2009. We were anxiously waiting to report a little good news from these real estate guru’s, but sadly there were no Bulls in attendance.
We thought our readers might be interested in the highlights, so we outlined some of the widely held opinions and sentiments expressed by the panel.
- Home prices will remain unaffordable in many markets.
- Until home prices reach a level that a couple on entry level salaries can afford to buy a starter home, the market will continue to correct.
- With rising unemployment, it is unrealistic to expect that lower interest rates will be enough to stimulate home sales.
- 12 months of unsold home inventory is extremely excessive. Too many houses is another sign that a turnaround is no where in sight.
- Housing will not have a V-shaped recovery, with prices rebounding quickly from a bottom. The chart will be L-shaped, with a long period where prices stay flat.
- Time is our best friend. The ecomony will take years, not months to play out. At a macroeconomic level, there is no point in talking about recovery yet.
- All the rescue plans, tax credits and bailouts will have little effect in the face of rising job losses, along with falling wages and confidence.
- If people understand the magnitude of the problem, and they plan to stay in their home for 5-10 years, then there is no real reason they shouldn’t buy now.
- No one on the panel reported that they see a glimmer of light at the end of the tunnel.
In the end, the “Bulls and Bears” session concluded with a sigh. The experts concurred that the market will still be grappling with many of the same issues it is today, one year from now. But, they are adapting to the new world order. New York Times reporter, Andrew Ross Sorkin stated that instead of spending his time writing about mergers and acquisitions, he is still busy. His new subject…Covering Bankruptcies.
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