Does the name Chris Thornberg ring a bell?
If not, Mr. Thornberg currently works for Beacon Economics in Los Angeles. He was one of the first economists to warn of a housing bubble starting in 2004. Mr. Thornberg was formerly with the UCLA Anderson Forecast. His latest predication is that there is a 75% chance of a recession and that housing prices will continue to fall. Ouch, big time.But how accurate is this info?
This information came from an article Mr. Thornberg recently wrote that was featured in a wide spectrum of newspapers around the country and had a headline that stated "Grim forecast for Economy, Housing." It seems Mr. Thornberg loves to spread bad news about housing and real estate in general (the glass half empty syndrome?).
It is interesting that further on in the same article it mentions that, "Best in 5 months - Payroll adds 166,000 jobs in October." Wait, I thought the sky was falling. And further on Mr. Thornberg indicates that the Bay Area might not be hit as hard as other regions. In fact, he says, the Bay Area economy is diverse and strong in the technology sector which will likely be a bright spot. He further states that trends in the Bay Area are some of the best in the nation. Now you’re talking!
I could go on, but I think I’ve made my point - the local, state and national press love to post headlines that are negative, jolting and not always balanced. I am not saying that all is wonderful in real estate at this moment, but it’s not all dire news either. But give the press half a chance and they will jump on a piece of bad news and ignore a parcel of good news.
Speaking of which, on the good news front, there has been a slight decline in both interest rates and number of homes listed. I predicted that November and December will show an overall drop in the listing inventory and mortgage interest rates - an even better reason for real buyers to start making offers to purchase. Sellers are beginning to understand that we have moved away from the hot market days of 2003 through 2005. You need to be a serious seller. If you don’t have a good reason to sell - don’t.
As for buyers, if you are concerned about further erosion of prices, then write offers at price levels that you feel comfortable offering. You never know, many sellers are now becoming more realistic about pricing and the values of their homes. This is a market where buyers for the first time in many years have negotiating power. Use it!
I am so proud of our team of real estate professionals. We continue to grow market share and have a wonderful camaraderie in our offices. Everyone is working hard, and seeing the great opportunities that come from a Buyer’s Market. Gang, keep up the outstanding effort. It is appreciated.
