LOOKING BACK-AND FORWARD

12.20.2007

Prior to early-mid 2007, we, and much of the rest of the country, were engaged in terrific activity in the real estate business. Almost everyone was feeling "good" at many levels with nary a problem in site.

One blip on the radar screen, in my view, was that of oil prices that were creeping up, falling back, then, re-creeping further upward month by month. No significant relief on this front seemed to be in sight. Still the economy seemed stable.

Then the sub-prime mortgage fiasco hit, along with other "realities" of the cost of living beginning to take "root" in peoples' lives. The real estate market cooled a bit-at first; then more and more. Until then, it was a great ride.

Now, almost across the "board" things have changed. A new economic reality is "setting" in for many. People are taking "stock" of their lives and in many cases, re-evaluating their needs including that of second homes. This alone is causing quite a "pause" in the pace of real estate sales around the NW corner. It hasn't stopped, but it certainly has slowed. One has only to count (and see the decline in) monthly transactions that occur in each of our towns to see the trend.

2008 will be an interesting year for this "second home" market. Those with unlimited bank accounts will continue to do what they please, hopefully continuing the purchase of real estate-around here. Others, with "flush" accounts, will buy as well, but perhaps at different "cost points". Another "group" will find (once) flush accounts in more of a decline than they would like; this group will postpone purchasing while they sort out "life"s priorities". Some of this group will come back to the market, others will leave it.

A final group will be further away than ever from being able to afford the purchase of real estate. Watch next week's final 2007 column for some statistics.


©2007 R Leech features