Tuesday, December 11, 2007

Predictions for 2008 home sales

Its almost the end of the year!

The NAR is estimating 5.67 million homes to be sold in 2007. What is your prediction for 2008?

Calculated risk had a convincing article that based on historical data, 3.0 Million homes would be a VERY deep recession.

WaMu in their little confession noted that they expect 40% fewer mortgages to be issued in 2008. 60% * 5.67 is 3.4 Million. Hmmmm.... But I'm an optimist... Not to mention it takes a while to really slide into a bad recession. So I'll bracket 3.5 Million to 4.0 Million home sales in 2008. Just for the fun of it, I'll predict two years out: 3.0 to 3.5 Million in 2009.

What's your prediction on price declines in 2008? Where I want to buy has dropped about 5%... Those that predicted where we are predicted a 5% to 10% decline in 2007 and a 8% to 20% decline in 2008. Since I think we're only avoiding the pain on a short term basis... I see a 15% to 20% drop in 2008. For 2009 I predict a 20% to 30% drop in home prices.

I'll add graphs and stuff to this article later. Consider it a 'stub' for now.

Got popcorn?
Neil

1 comment:

sandman said...

Wow Neil, looking at those numbers makes me cringe. No doubt, if they come to fruition we'll be in a lot of trouble.

But I agree with you. I might lean towards the upper end of your sales ranges, but that's just a gut feeling, no facts behind it.

As for my area, it's a suburb of Phoenix that's always been considered "desirable". Lots of shopping, higher-end houses, etc. etc. (fill in your favorite Realtor-speak here). Homes sold for maybe $200k in 2000, and $425k at the peak. Well, according to zillow we've been down a consistent 20% for a few months now - and we know that zillow is optimistic. When I show that to people it really grabs their attention. "Ahwatukee is down 20%? What??!?"