Editor’s note: Inman News is conducting a future-focused real estate industry survey as a part of its Roadmap to Recovery editorial project. This Roadmap to Recovery survey is intended to gather insight into market conditions, what might turn the market around and how the industry must change to adapt to a new world. The results in their entirety will be published in the coming weeks. Inman News is also conducting a separate survey on the Future of Real Estate Commissions. Click to read the second, third and fourth articles in this series.
The real estate industry is coming to grips with the realities of the housing market and most professionals are not predicting a turnaround until 2010 or later, according to early results from an Inman News survey.
Those results are based on responses from 559 readers who completed the 21-question online survey. The survey asks participants to weigh in on: current and future market conditions, new regulations, new business models, and other business practices and trends.
The results provide some sobering insight into where the market is going and how it will recover.
Fifty percent of those surveyed do not expect a housing market recovery until 2010, and another 40 percent do not expect it to recover until 2011 or beyond. Only 10 percent of those surveyed expect a recovery in 2009.
Eighty percent of those surveyed expect stable or lower sales volumes in their local housing markets next year, while about 19 percent expect real estate transactions to increase. And 14.7 percent expect national sales to climb next year.
The perception that local markets are performing better than reports on national housing conditions holds true in the survey. Or at least the results show that those surveyed believe that their market will outperform the national housing scene.
Survey participants were asked to respond to questions that looked at both national and local market conditions.
Thirty-eight percent of those surveyed expect lower sales volumes next year in their local area, but 58 percent expect national sales to be down in 2009.
Either way, the outlook for a recovery is not good for the coming year, according to the survey.
Only 9.2 percent of those surveyed expect home-price increases next year, while 41.6 percent expect a decline. The silver lining in the results: 50 percent expect no changes in prices next year, up or down.
A decline in home prices is among the obstacles to regaining economic health. Flat home prices would be better news, as many economists are predicting a dismal outlook for next year.
Comments in the survey supported the rather negative mood the industry has about the prospects of a near-term recovery. Some examples:
- "Prices will begin to stabilize in some markets in 2009 but increases will take three to five years."
- "Recovery may begin next year, but it will take at least five years to come back."
- "We will see the ‘bottom’ somewhere in first-quarter 2010, but it will take at least another two years to cycle through all of the short sales and foreclosures."
Some respondents offered parallels to past downturns. "It took 20 years for a return to the boom peaks in our market," explained one reader.
Indeed, what represents a recovery? Is it the end of falling prices, stabilizing sales volumes or a return to the go-go days?
Learn more about the Roadmap to Recovery project and how you can participate at Inman.com/Roadmap.
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