Inventory will be one of the keys to how housing prices perform in 2013, however the three biggest factors remains jobs, jobs, and jobs. Followed by interest rates. Pent up demand drove sales in 2012 because it sure wasn’t due to job growth not able to even match new entrants into the job market. Investors also added to demand accounting for an estimated 28% of all home sales.
The stage is now set for the 2013 housing market and it remains cloaked behind a curtain not yet raised. Will millions of foreclosures mysteriously begin to appear? Will the phantom job market miraculously begin to add to demand?
Release of more foreclosed homes is more probable than job creation adding to demand.
As bad as Q4 GDP falling into negative territory was the collapse in Consumer Confidence. The media wants to blame falling confidence on the expiration of the payroll tax holiday. That is certainly a part of the reason, however that doesn’t give consumers enough credit.
Is it possible the collective wisdom of the consumer after listening to Obama’s inaugural dead left progressive edicts, including Climate Change that has driven up their costs of necessities could have contributed to a crisis in confidence? Could dysfunctional government be a cause?
Sure that’s possibly part of the decline in confidence, but in my opinion they are simply scared. People don’t see or are living any recovery. They see Washington DC and Wall Street thriving while they languish. What a better boost to confidence could there be if main street actually saw jobs being created?
Since jobs are the key to housing sales my outlook is for more of the same. The media will continue to report a non-recovery as recovery, banks will withhold inventory, jobs will languish, and confidence will remain low.
Why? Because only liberal pundits, academia, economists, media, and the new Collectivist Party, formerly known as Democratic, could possibly say that what Obama is doing is working.
The opinions expressed here are solely those of Fritz Pfister or identified sources, and not necessarily those of RE/MAX Professionals of Springfield or RE/MAX International.