Market Woes? Chill out, it's not bad!

Here in the Mt. Washington Valley in northern NH it is extremely frigid right now...not just the temperature but the real estate market has significantly cooled (more like frozen over) since last year. However, there are some signs of life beneath the ice. Buyers who have not been dissuaded by negative forecasts, are once again out and about; more so, they are buying! My office just hosted a "Buyer's Celebration" which was very well attended, and enthusiastically received!!!

In reviewing the local market, I see that 2007 had less active residential listings (948 versus 1,166 in 2006), that translates into less dollar sales volume ($286,721,340 versus $361,763,356 in 2006). Ironically the "list-sell" percentage was only slightly down from 94.4% to 93.5%. The average days on the market from 133 in 2006 was up to 154 in 2007, which is not really significantly higher either.

For those buyers who are "on the fence" about buying, please remember this: real estate market, like any other, is cyclical. So even today, the market has lots of buyers and lots of sellers; while it may not be the booming market it was 2 years ago, it still tops the market from 2002 for example. Besides today's buyers have so many choices to pick from, and the prevailing interest rates are great!

Buying real estate should also be primarily for the purpose of shelter, that is, it should be viewed as a long term investment. Buyers need to know that buying real estate as a short term, flip it to make money maneuver, is not a sound and viable investment strategy. Does real estate make a good investment? Yes it does, in the long term!

In addition to low interest rates (today's 3/4 of a point drop by the Federal Reserve should eventually translate into lower mortgage rates also, and give the economy a boost) low unemployment in most parts of the country, and low inflation rate seems to indicate that the economic outlook is NOT as bleak as some media coverage would have you believe.