2010 REAL ESTATE FORECAST
Real Estate Update with Cheryl Marlow
770 KKOB AM’s Residential Real Estate Specialist!
It's a New Year and that means it's time for realtors across the country to give their predictions for 2010, and I'm ready to give mine! According to housingpredictor.com, the housing market will see an increase in sales in 2010. This is great news! With the help of the tax credits of $6500-$8000, for home purchasers and government backed lending, sales will continue to increase in the affordable price ranges. Many buyers will wisely take advantage of the incentives available and take the plunge into buying a home this year!
Unfortunately, we have to be aware that the real estate market will always be affected by the unemployment rate. However, New Mexico is much better off than most other places around the country, and let me tell you why. The national unemployment rate has risen to 10.2% and even up to 20% in some areas. But here in our state, government jobs account for more than 1/5 of the jobs in New Mexico meaning better job security for those who hold those positions. This helped us to stay afloat during a time when the nation faced financial crisis. And helped us to maintain our home values better than many other areas. Hopefully we will see a decreasing unemployment rate this year that will boost the market for homeowners and the economy!
When it comes to mortgage and interest rate predictions for this new year, I believe we will see some new things. Currently, government backed mortgage rates are coming in between 5 and 6% which is historically low. But, they are on an upward climb! A federal reserve program to spend over 1.25 trillion dollars to support these mortgages is scheduled to end in the spring. This will negatively affect mortgage rates. As the rates increase the home sales will slow down. We should see a steady increase in sales over the next few months until rates rise again and government backed mortgages and tax credits come to an end.
As always, certain areas of the Greater Albuquerque Area are hotter than others, and this will be the case in 2010. The affordable areas of the Northeast Heights will continue to be the hot spot in the market. On the other hand, outlying areas such as Placitas and the East Mountains have been relatively slower when compared to others, and unfortunately I think this will continue also.
The over $500,000 market will continue to be slower than what we would like to see, partly due to challenges in financing these higher end homes. But a great thing to look forward to is an increase in home sales in the affordable price ranges due to the extended tax credit. We should see a great deal of business coming from this credit that ends on April 30th. Typically when someone sells their home they purchase a larger more expensive home creating what I call a Domino effect of home sales, so these affordable sales will help the overall market in all price ranges and that's good news for all of us!
Cheryl Marlow
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