Since there are Real Estate Investors
and Forum members from all over the
United States I wanted to know what
Date in the future do you feel your particular
market will bottom out in Real Estate Prices
and start the long climb up?
Looking into my crystal ball, the market will bottom in my markets sometime in the fall of this year. My crystal ball has magical powers or contacts with the spirit world and just knows.
My educated guess is that the real estate markets will bottom just before the credit markets thaw out. For the credit markets to thaw out, the banks have to start lending again. For the banks to start lending, consumer confidence in the economy will have to improve to the point that the consumer is not afraid to spend and/or invest new money.
Consumer confidence will get there as a result of some triggering event in the stock market that signals an end to the bear market, the start of a bull market, and a sign that the economy is on a sustained path to full recovery. I am guessing that that triggering event will be when the DJIA breaks through 9000 and finds support there.
My crystal ball says that will happen sometime this fall. I don’t know why my crystal ball says so. Maybe because fall is the end of the 2009 fiscal year for many corporations and new more optimistic earnings predictions for the next fiscal year will be announced almost daily which will serve to move the stock markets upward. When the US stock market does well, the global markets improve too.
October 1, 2009 will also be the beginning of the fiscal year for President Obama’s first annual budget. Whatever economic stimulus that is proposed will have funds appropriated for that budget and the authorization bills to spend the budgeted money will be passed. Government spending will drive the economic recovery for awhile, create jobs, put money in more consumers pockets, and provide the sustained economic stimulus we need to restore consumer confidence.
I think that is why my crystal ball is saying fall of this year. However, my crystal ball does not have a good track record for accuracy. I think it just flips a coin.