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Market News and Trends

Warren Buffett on housing recovery


Obviously, the current housing downturn is still unpredictable, and subject to many influences in the larger national and world economies, but Warren Buffet has made a lot of money by being right in his forecasts more often than he has been wrong.  Bloomberg News reported yesterday on his recent report to Berkshire Hathaway shareholders:

Buffett Says U.S. Housing Will Recover by Next Year

“Within a year or so, residential housing problems should largely be behind us,” Buffett wrote Feb. 27 in his annual letter to shareholders of his Berkshire Hathaway Inc. “Prices will remain far below ‘bubble’ levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits.”

“High-value houses and those in certain localities where overbuilding was particularly egregious” will take longer to recover, he wrote.

As I have written separately, we may see a second wave of foreclosure activity in 2010 as interest rates reset for Alt-A and Option ARM mortgage products.  If housing demand weakens with the end of the current tax incentive programs, and if interest rates for new mortgage loans begin to edge upward this Spring and Summer, the supply of homes in many markets will continue to exceed demand.  By next year, though, the true market correction should be able to take hold.

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About Bill Morris, Realtor

More than thirty years of business experience (high tech, client service, business organization and start-up, including many years in real estate) tell me that service is the key to success and I look forward to serving you. I represent both buyers and sellers throughout the Austin metropolitan area, which means first-hand market knowledge is brought to bear on serving your needs: -- Seller Representation is a comprehensive process that begins with thorough market analysis and consultation, continues with properly staging the home to achieve the highest price possible in a reasonable time on market, a complete program of marketing and promotion, ongoing updates and communication, closing coordination, and follow-up throughout (and after) the sale. -- Buyer Representation is also full service: shopping, previewing, price and market consultation, contracting, negotiating, coordination of inspections, appraisals, repairs, and closing details, and follow-up beyond the closing of your purchase to ensure your lasting satisfaction. Because the real estate industry is becoming more sophisticated and challenging every day, you need a professional that understands the industry and is positioned to stay ahead of the game. I go the extra mile to help you achieve your goals. That's why I constantly research the market and property values so your home is priced effectively from day one. I also make sure the public knows your home is for sale by using innovative advertising and marketing techniques to attract potential buyers.

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