Happy New Year

As a real estate professional I say "good riddance" to 2010. Here's to a better year in 2011.

As I often mention, the real estate market does not operate in a vacuum, but is part of the overall economy. That being said, here are my predictions for the upcoming year.

The economy, in general, will continue its recovery. Although the jobless rate will remain a major concern, it will likely improve at a rate better than most expect. Unfortunately, it will take improvement in unemployment prior to any significant recovery in the real estate market. I expect values to stay relatively flat over the next year. This will be due in large part to the "shadow" inventory lenders will gradually funnel into the market over the next 1-2 years so as not to flood the market with bank-owned homes. Additionally, I see mortgage rates increasing on a gradual basis. So long as it is gradual, this may actually be a good thing (see prior blog entry). However, at some point, an increase in interest rates would be a major setback for the housing market.

The good news is that, as always, an economy in a state of flux can be extremely beneficial for savvy real estate sellers, buyers and/or investors. Not only is real estate local, it is segmented. If you do your homework and seek guidance from those who are experienced in real estate, tremendous opportunity awaits in 2011.