BluefoxToday blog : Long-term U.S. housing forecast positive

Long-term U.S. housing forecast positive

Most of the U.S. is still mired in a real estate slump, in a deep one in some areas and in a little shallower one in others. Las Vegas probably belongs to the deeper customer type, although it's now trying to lift itself off the gutter. Sales numbers here are up and price declines are stabilizing which make for the good news. Inventories do remain too high, though, accounting for the bad news. Anyway, that's the less-than-rosy picture in the summer of 2008.

Let's look ahead to the next decade, from 2010 to 2020, and see what might happen then with the national real estate market. Harvard University's Joint Center for Housing Studies just released its latest review, "State of the Nation's Housing 2008". It optimistically says that housing demand continues at a healthy pace throughout the time period due to a steadily expanding population.

Two important demographic factors that weigh heavily here are the estimated annual immigration at 1.2 million and the gradual rise of life expectancy among baby boomers. These trends have been around for a while now, so no surprise there.

The more notable development is in the social trend sector. Americans are divorcing at an increasing clip and also are tying the knot later, if at all, which then translates that single-person home ownership is becoming the fastest-growing household class. With that in mind, the size of the future home is likely to shrink and it could also mean that they will prefer condos and townhouses over the more work-intensive single-family houses.

The study also points out that during the next decade household growth in U.S. will exceed 1.4 million each year. It makes for a healthy housing demand and is expected to return the real estate market to a solid footing once again.

 

 

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Provided by: 

Esko Kiuru
Mortgage, real estate and apartment industry analyst 

www.BluefoxToday.com - syndicated mortgage, housing and property management blog

eskokiuru@gmail.com
My cell: 702-499-1006

Comment balloon 25 commentsEsko Kiuru • June 25 2008 12:13AM

Comments

Demand is the number that many overlook.  People need a place to live so the demand will continue, no matter what the economy does.

Posted by Randy Prothero, Hawaii REALTOR, (808) 384-5645 (eXp Realty) over 10 years ago

Our area is still getting worse...a 5 yr condo supply and a 3 yr single family supply and the banks aren't helping their own matter by holding up negotiating shorts.

Posted by Neal Bloom, Realtor CRS-Weston FL Real Estate (eXp Realty) over 10 years ago

Esko any good news is welcomed at this point.  What is ironic is that something negative like divorce would translate into good news for house sales.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 10 years ago

Esko, I'm all for household growth! The banks here are beginning to show promise...short sales are being accepted and inventory is declining with new ones yet to surface. I see a rosier picture on the horizon.

Good news is ever so welcome...

Posted by Gena Riede, Real Estate Broker - Sacramento CA Real Estate (916) 417-2699 (Riede Real Estate, Lic. 01310792) over 10 years ago

Let's hope our right or there right...morgage rates are going back up, we have to get a hold on the gas and food pricing first..............

jack

Posted by Jack Climer (Jack Climer Realty, LLC) over 10 years ago

I agree that population growth is the key to appreciation.  But one has to be careful to look at each individual area, as some areas may be increasing in population and others decreasing.

Posted by Robert Machado, CPM MPM - Property Manager and Property Management (HomePointe Property Management, CRMC) over 10 years ago

Randy,

Housing demand looks good for the next decade.

Posted by Esko Kiuru over 10 years ago

Neal,

Hopefully your oversupply gets absorbed pretty soon.

Posted by Esko Kiuru over 10 years ago

George,

It's kind of funny but divorce does benefit the housing industry.

Posted by Esko Kiuru over 10 years ago

Gena,

Good to hear that things are improving up there in the Sacramento area.

Posted by Esko Kiuru over 10 years ago

Ron,

Decline in mortgage rates would be helpful now.

Posted by Esko Kiuru over 10 years ago

Jack,

We do have some economic issues that are slowing everything down.

Posted by Esko Kiuru over 10 years ago

Robert,

Location is definitely a large factor in how real estate markets behave.

Posted by Esko Kiuru over 10 years ago

This isn't the first downward cycle and it won't be the last.  People who were in real estate when interest rates were 11% still sold houses because the demand was there.  I feel, in our market, we are bumping along the bottom and are getting ready for the upswing.

Posted by Kathy Anderson, Arizona Retirement Homes For Sale, Sun City Grand (HomeSmart) over 10 years ago

I bought one high in 2006 and hopefully low in 2008 expecting prices to come back quickly after election

Posted by scott over 10 years ago

I wish you the best in sin city, because here in the midwest, housing has been up this month....a little slow down, but I think everyone from the west coast and east coast is moving this way....

Posted by Jack Climer (Jack Climer Realty, LLC) over 10 years ago

Scott,

Hopefully the market does recover soon.

Posted by Esko Kiuru over 10 years ago

Jack,

Vegas is also showing some signs of an up-tick, so that's encouraging. Great to hear that Midwest is moving right along.

Posted by Esko Kiuru over 10 years ago

Kathy,

That's the way the real estate market works. This down cycle is just a bit steeper than some others were.

Posted by Esko Kiuru over 10 years ago

No offense Jack - Midwesterners are wonderful people but us westcoasters aren't moving to the Midwest - especially not in droves.

Here in central Phoenix inventory down for 6 mos straight, pending up, sales up 6 mos straight - 35% lower inventory now than in January 2008 and our prime selling season is winter, not summer

Good days are ahead despite the biased sensationalized media

 

Posted by john dough over 10 years ago

There are always people needing to buy and sell. It certainly helps if people have some money and jobs and prices are realistic.  Maine seems to stay pretty steady compared to florida and arizona lately. Thats just my 5 years in the industry experience. And what some of the 20 year vets tell me.

Posted by Justin Douglass (Benchmark Residential & Investment Real Estate) over 10 years ago

John,

Good news for Phoenix.

Posted by Esko Kiuru over 10 years ago

Justin,

Realistic prices make a stable market.

Posted by Esko Kiuru over 10 years ago

Its funny looking at Kathy Anderson, Scott and other's foolish predictions.  Do people take responsibility for what they write? These "experts" couldn't have been more wrong but when they make predictions now - do they inform people about how far off they were before?

 

Its December 2008 and I predict, Las Vegas prices will continue to fall at least through mid 2009 and maybe longer.

Posted by Steve almost 10 years ago

Steve,

Market prediction is rather difficult but let's see what happens in the next several months.

Posted by Esko Kiuru almost 10 years ago

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