REAL ESTATE MARKET PROJECTIONS? FACT OR WISHFUL THINKING?

By
Real Estate Agent with Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate 303829;0225082372

TAKE OFF THE ROSE COLORED GLASSES and PREPARE FOR REALITY.

John Mulkin provides another thoughtful analysis of the real estate industry in his accounting of his 2010 predictions.  As always, a worthy read for members who want to know the facts.  See:  Housing and Economic Predictions for 2011 and Beyond

John isn't projecting a positive financial picture for the real estate industry for 2011.  I agree and believe that it will be many years before the real estate industry will be positive. 

AGENTS MAY WANT TO TAKE JOHN'S thoughtful analysis and prepare.  For years now we have advocated using a business plan to help manage your business.  Now, we need a BUDGET PLAN to help manage our resources. 

agentThe RETRACTION evidenced by sales volume has it's foundation in the uncertainty and lack of confidence of the average consumer AND the RETRACTION in the numbers of home buyers in the market.  The old "rosy scenario syndrome" is misleading and could lead to financial ruin for many real estate agents and brokers. 

Agents and brokers plan their budgets for advertising and promotion based on projected sales and commission receipts.  By publishing positive sales and growth projections, we grunts in the real estate industry could be encouraged to dissipate our limited resources chasing business that doesn't and isn't Agentlikely to exist for some years to come.

If anyone is familiar with new construction sales, you know that builders are quite likely to raise base prices of their models after booking 1-3 sales contracts.  Do they seriously believe that a sale or two or three is hard evidence that the market is now roaring into positive territory??? 

Plan for no growth and your resources will last longer.  Real estate agents and brokers and the NAR need to learn to see what is and not what they believe will convince consumers that "it's a good time to buy."  Is it a good time to buy??  Sure it is.  THAT IS GOOD NEWS FOR THE CONSUMER.  However, when we publish market reports that show a modest gain in home prices, we don't always publish the concurrent reduction in sales volume. 

I believe we're in for tougher times than most expect because we're not getting the facts from NAR, which speaks for our industry. 

They have yet to publish a word addressing the percentage of would be home buying consumers with credit damaged by foreclosure, short sales, unemployment and bankruptcy.  Take those consumers OUT OF THE REAL ESTATE MARKET and what then would the sales projections be????

Many consumers will be OUT OF THE MARKET FOR 3-7 YEARS.  The NAR and the federal and state economists are using OLD and IRRELEVANT financial models to project future real estate market growth.  By using gross population numbers to future sales and growth, they have failed to account for the MILLIONS of consumers will will not be able to buy a home for some years to come.

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988.

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Re-Bloggged 3 times:

Re-Blogged By Re-Blogged At
  1. Donald Bradbury 09/23/2010 07:05 PM
  2. Jerry Morse 09/24/2010 12:10 AM
  3. Jerry Bronstrup 09/24/2010 12:12 PM
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Topic:
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Comments 89 New Comment

Ambassador
2,276,183
Lenn Harley
Real Estate Broker - Virginia & Maryland
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate

George.  Thanks.

Judy.  I've thought of little else since the buying pool began to shrink and I got so many calls from wishful home buyers who went through a bankruptcy, foreclosure or short sale in the past 2-3 years wanting to know what they could do. 

Monica. A reality that the government has yet to notice.

Beverly.  They are your words.  I cringe each and every time I read a comment from anyone that begins or includes the American home buyer in this catastrophe which simply gives cover to the real perps.

John A.  Dec. 6????  As to the final post, I believe we're seeing that in the public today with the Tea Party Movement.  Ground up forces involving millions calling the politicians to account.

The NAR is institutionalized and in terms of managing the Association systems doing a good job.  It's when they fail to alert the membership about reality of market forces that they fail.   My opinion.

September 27, 2010 06:16 AM
Rainmaker
267,515
John DL Arendsen
Real Estate Broker, Mfg Home Dealer, General Contr
TAG Real Estate Sales & Investments & ON THE LEVEL GC

Sorry about the date. I knew it was Dec 7th but my brother's b-day is o the 6th so it's a force of habit.

There's other points we could discuss re: NAR but I'll save that for anoher conversation. Maybe even a post.

September 27, 2010 10:17 AM
Ambassador
2,276,183
Lenn Harley
Real Estate Broker - Virginia & Maryland
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate

John.  I assumed it was a typo.  I'll watch for your post.

September 27, 2010 10:37 AM
Rainer
24,450
Debra V. Edwards
Realtor/Builder, Cashiers, NC., Highlands, NC., Glenville
edwards builders and realty, inc.

Yeah and Lenn, those honest, hard-working, patriotic Americans find themselves with poor credit scores....just because of job loss....Sad!  debra

November 29, 2010 01:29 PM
Ambassador
2,276,183
Lenn Harley
Real Estate Broker - Virginia & Maryland
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate

Debra.  Noone in a position of "should know" understands the damage to the economy by consumers whose credit is ruined.  They aren't buying homes or much else.

 

November 29, 2010 01:32 PM
Ambassador
2,276,183

Lenn Harley

Real Estate Broker - Virginia & Maryland
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