Dare we hope?

I ran across this Case-Shiller housing index graph. We are all painfully aware of the current news with failing banks and failing countries! The Dow has lost almost 40% of its value this year and the housing market is taking the blame for it all.

This chart shows the historic values from 1990 to the present, and as we know, the housing market across this country has lost about 17% of it's value this year. But, look at the last 3 ticks. The forecast is going up in 2009 recoving about half of this years loss. No one knows for sure what will happen, but amid all the frightning news it is nice to see something positive. It looks like we may turn this ship around after all and not have to pick out a nice cave to live in!

Through out all of this news, keep in mind that the Iowa City market gained 3% in 2007 over 2006 and it looks like we will have a similar gain in 2008 over 2007.

Stay tuned!

$700 Billion

I cannot even imagine how much money that is. The real question is will this bail out have the desired effect of liberating the commercial credit markets from non-performing, or under performing "sub prime" loans allowing them to start lending to banks and businesses. And will it happen soon. Another question without an answer is what are the long-term effects of this bail out. Will this fix a current problem and create a long-term one? I don't know the answers to any of these.

What I do know is too many people are talking about this. The problem is on every ones mind. This type of issue can become a self-fulfilling prophecy if left un attended and un addressed. I have also seen commercial lending change even in Iowa City lately. Loans are being scrutinized, and LTV ratios are falling. Easy loans last year are tough loans this year. And, an active real estate market requires available financing. I have also seen business startup and expansion plans be put on hold pending the shakout of this problem.

My hope is that this plan returns liquidity to US credit markets and takes the heat off banks and businesses. I hope that we are able to also drill down through the mortgage backed securities aspect of the bail out to the actual home loans and deal with them on an individual basis. This will require a lot of administration, but it will also protect our $700 Billion investment and will help restore a healthy resale housing market.

This thing is unfolding in real time, so we will all see what heppens very soon. Buckle up.

Jeff joins Lepic-Kroeger Realtors

After 13 years at Coldwell Banker Real Estate Professionals why change companies? I out grew it. CB is a great company to learn the business and they have loads of resources for newer agents.

Lepic-Kroeger offers more oportunities for more experienced agents and as a result of that, has more experienced agents. The agent pool sells more properties and so, this association is better for me and my clients.

There are great agents at both companies and at most companies in Iowa City. I am excited about this move and am energised by it to move to a higher level of professionalism and professionals service.

My new address is 2346 Mormon Trek Blvd, Iowa City, Iowa 52246 and my email (jeff@icrealestate.com) and my cell phone (319-331-6187) are the same.

I'll try to report in more often than every 6 months!

New year, new opportunities

Wow...have I been remiss in posting new material. The market has been so strange and difficult to predict that I just waited on the sidelines and watched the sales to see what was happening. It seems that sales are about the same in 2008 as they were in 2007. This is a good sign. Interest rates are creeping up to just under 7%. This is not a good sign. Home prices are increasing at about a 2%-3% rate over 2007. This is a normal range and is also a good sign. With all these good signs, why do we have the feeling that real estate is in trouble? Real estate is a local phenomenon, but money (interest rates, jobs, wages, prices, oil) are national considerations. We cannot divorce ourselves from the national trends even thougth things are moving along in Iowa City. We pay more for gas, heating, and well, everything. We pay a little more for interest rates, too.

I think people have a lower degree of faith in the future, and want to made darn shure that are getting a good value for their real estate purchase. I do too. Buyers a looking at 12 instead of 3 houses. We have more low offers that in the last decade. Also, for the first time I have seen in Iowa City, buyers are not qualifying for their loans.

This is not all bad. We should be responsible and make sure we are getting value for our purchases. We should be aware that finances are different now than in the past and travel is expensive and we are vulnarable to oil prices. We can still be secure, happy, content and free...and responsible and that is a good thing!