- The Washington Times - Friday, December 11, 2009

At the end of every year, those who watch the real estate market start wondering what next year will be like. Could we see a rebound in home prices? Is the market going to come back strong? Or do we face more difficulties ahead?

Sitting here this December, speculating about 2010, I feel that the future is even more mysterious than usual.

On the one hand, there are a lot of factors that could make it a great year for Washington-area real estate. Home prices are much lower than they were a few years ago, and that has stimulated buyer demand.

Mortgage interest rates are ridiculously low, making homes even more affordable. The extension and expansion of the federal tax credit should boost sales in the early months of 2010.

On the other hand, those factors may change. It is unlikely that Congress will renew the federal homebuyers tax credit for a second time. So, we’ll probably see some drop in buyer demand next summer. (The tax credits only apply until April 30, 2010.)

Low interest rates might go away too. When they do, buying a home will become more expensive.

With unemployment still a very real issue for many Americans, buying a home could move further out of reach for many.

All that said, we are still in a better place than we were a few years ago. Take a look at today’s charts and notice how much higher sales are these days. Also, notice how much lower the inventory is.

Those are both very encouraging statistics, and they form the foundation for what should be an active and healthy housing market in the first half of 2010.

It’s the second half of next year that seems so hard to predict right now. Stay tuned.

Contact Chris Sicks by e-mail (csicks@gmail.com).

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