Half Way Thru 2009, How Accurately Did the Economists Predict It? And NO ONE thought the Stimulus Plan would spend SO MUCH MONEY!

At the start of the year, the "experts" made a lot of predictions about the U.S. economy and what to expect in 2009.

• Some said housing would rise
• Some said housing would fall
• Some said mortgage rates would rise
• Some said mortgage rates would fall

And nobody predicted just how big the government's stimulus package would be.

Now, on June 30, with the year officially half-over, it's as good a time as any to remember that people are much better at interpreting the past than predicting the future. Economists can make educated guesses about the future, but they're guesses nonetheless.

It's like watching the Weather Channel. A meterologist can look at the data and say it's going to rain next week, but the forecast is never 100%. As Gary Keller, founder of Keller Williams Realty, said last fall, "real estate is local and saying that real estate in one place is the same as another is the same as saying the weather is the same everywhere."

So far this year, mortgage rates have been up and down, credit availability has been higher and lower, and home prices have varied immensely from neighborhood to neighborhood.

There's another 6 months until 2010 and there's no reason to expect the current volatility and uncertainty to change. Yesterday, a new client asked me what I thought would happen in our Renton housing market in the next year or so and my answer was "more of the same"...... still flat with rates up and down and another load of adjustable rate mortgages coming due this fall to increase our distressed housing supply."

The world is unpredictable and so is the U.S. economy. Therefore, consider making your personal finance decisions based on the information at hand today instead of on an educated guess about the future. Remember we only have 3 months to find the right home and get an offer written if you are using the "first time home buyer $8000 tax credit." Do not hesitate on this one.

After all, the weatherman's been wrong before.