Increased Home Sales Still Projected for 2007
Earlier this week, TREND released its most recent Economic and Market Watch Report that combines analysis of data from the 1st Quarter of 2007 with projections by local and national economists. In brief, TREND projects house sales to continue to improve throughout 2007 with modest increases in average price and days on market. Key factors in this forecast are relatively strong employment figures in Chester, Delaware and Montgomery counties (despite some job losses) and still historically low mortgage rates. Lawrence Yun, Senior Economist for the National Association of REALTORS, adds about the Philadelphia-area market, "With more jobs possibly coming around [to Philadelphia] given the weakness of the dollar, this should help in lining potential homebuyers. I project home sales to show a year- over-year growth by the fourth quarter with the momentum strengthening in 2008 couple with a respectable rise in prices."
Another challenge the local market will continue to face through 2007 are some of the after-effects of the problems caused by Sub-prime loans for a few consumers. Ken Fears, Manager of Regional Economics for the National Association of REALTORS contributed a piece to the Market Watch regarding the cause and effect of the Sub-prime. He states that beyond the lessons learned by the industry and consumers, that the sub-prime issue is helping the market further correct itself. Fears concludes, "What the market is facing is the psychological impact on buyers as they struggle to understand what all of this new information about sub-primes and a slowing economy mean for their buying decision. This waiting and uncertainty for REALTORS may be agonizing, buy it is better for the health of the market in the long-term.