"The Economy is Improving, But..."
January 5, 2011
As I listen to interviews of economists and financial professionals, I am struck by the one common denominator in all their economic forecasts for 2011. That common denominator is the phrase: "but housing is a concern". They are generally agreed that the economy is turning around. They cite various segments of the economy and the data supporting their assessments and their predictions. The remarkable characteristic of almost 100% of the interviews is the exact same verbiage about what might derail their predictions for an economic recovery; " but housing is a concern".
I realize that many of the experts being interview are located on the east coast, but I feel certain that they have access to nationwide data and that they base their opinions regarding the economy on the totality of the data.
I am delighted that the general consensus is that we are coming out of the recession and that the economy is on the road to recovery. However, as a real estate professional, housing is always a concern to me. Clearly this has been a recession that hit housing below the belt. There are hundreds of opinions as to why it so impacted housing or why housing so impacted the economy. "Irrational Exuberance" a phrase coined by form Fed Chairman Alan Greenspan, infected all of us; buyers, sellers, agents, lenders. Perhaps we should have had "rational exuberance" to celebrate the ability of so many to finally own their own home.
As we adjust to a "rational" real estate market perhaps sellers and lenders will take their lumps. Buyers will recognize that the "now" market is as great a time to purchase a home as there may be. If buyers, sellers and lenders accept the "now" market, perhaps housing will not be a concern for the economic recovery.
As I listen to interviews of economists and financial professionals, I am struck by the one common denominator in all their economic forecasts for 2011. That common denominator is the phrase: "but housing is a concern". They are generally agreed that the economy is turning around. They cite various segments of the economy and the data supporting their assessments and their predictions. The remarkable characteristic of almost 100% of the interviews is the exact same verbiage about what might derail their predictions for an economic recovery; " but housing is a concern".
I realize that many of the experts being interview are located on the east coast, but I feel certain that they have access to nationwide data and that they base their opinions regarding the economy on the totality of the data.
I am delighted that the general consensus is that we are coming out of the recession and that the economy is on the road to recovery. However, as a real estate professional, housing is always a concern to me. Clearly this has been a recession that hit housing below the belt. There are hundreds of opinions as to why it so impacted housing or why housing so impacted the economy. "Irrational Exuberance" a phrase coined by form Fed Chairman Alan Greenspan, infected all of us; buyers, sellers, agents, lenders. Perhaps we should have had "rational exuberance" to celebrate the ability of so many to finally own their own home.
As we adjust to a "rational" real estate market perhaps sellers and lenders will take their lumps. Buyers will recognize that the "now" market is as great a time to purchase a home as there may be. If buyers, sellers and lenders accept the "now" market, perhaps housing will not be a concern for the economic recovery.
posted by shirley harry at 8:31 AM
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