Real Estate Market Predictions for 2004? - Posted by soothsayerbob

Posted by GL(ON) on December 21, 2003 at 08:13:59:

Actually I expect we will go into an inflationary period like the 70’s. Double digit annual increases in price, even faster increases in expenses, and double digit interest rates. Those who buy now and lock in low interest mortgages will be sitting pretty if they hang on for 5 to 10 years.

To be clear, I don’t expect this all to happen in one year. But I believe it has already started and is now inevitable. We are not used to thinking in terms of inflation but it is definitely a bigger factor than it was a few years ago. Have you noticed that every time you go shopping some things that haven’t changed in years suddenly cost a lot more, like 25% to 50% more?

But what difference does it make? There are always opportunities of one kind or another in real estate.

Real Estate Market Predictions for 2004? - Posted by soothsayerbob

Posted by soothsayerbob on December 20, 2003 at 22:18:21:

Generally speaking do you think the trends for 2003 will continue in 2004? Will single family residential continue to boom while commercial and rental markets sag? Will mortgage rates hover around 6%?

Personally, I think more of the same for next year.

What do you predict?

Re: Real Estate Market Predictions for 2004? - Posted by Beth (CA-FL)

Posted by Beth (CA-FL) on December 21, 2003 at 20:29:09:

Look at what is still the largest part of the population and what their needs are… Baby Boomers.
The first group starts retiring in 2009 (born 1946). I think real estate that most of the population seeks (vaction rentals, resort properties, second homes, places to retire, etc.) will do well for a while.

And then there are the boomers kids, who may be your tenant/buyers. See what they would need in your area.

Speaking of area, real estate is dependent on the economic factors in your region.

So figure out how your area’s R.E. market factors for you and your goals, strategies, etc.

Personally I will ALWAYS stay in R.E. investing, but the stock market is primed for a big climb so I will get back in soon. Then in 2009 a major correction as boomers start retiring (and so most of the population becomes ‘unproductive’… like what happened in Japan).

These are just my thoughts. I’m not a fortune teller but I do A LOT of reading (about 5 to 10 R.E. investing books and books about the economy a month). Harry Dent’s “Roaring 2000’s Investor,” I found to be helpful.

In most cities, I think 2004 will be the “peak” year in this real estate bubble that has been forming. Then leveling soon after. Exactly when that starts depends on when the feds start raising rates. If by summer 2004, then that’s when the down cycle starts. But real estate has nice cycles (5 to 7 years) unlike the stock market which can climb and plummet in a day or month.

I am currently in Central CA. What happens in the big cities (L.A. and San Francisco), usually happens in my area a couple years later. So those major markets are nice barometers.

I’m moving to N.E. Florida and will have to figure out what the barameters there are.

I hope my rambling has helped.

Happy investing!


Re: Check out this book - Posted by Brad (CA)

Posted by Brad (CA) on December 21, 2003 at 13:59:28:

“The Coming Crash of the Housing Market” by John R. Talbott

This is not fortune telling but a statistical and factual based look at where the real estate market is today.

From the people I have talked with and things I have read, etc, I think in my area, we should have a pretty good 2004 and sometime after soften up for a while. But, no one can tell the future.

Another good book on the subject of real estate markets is “Timing the Real Estate Market” by Robert M. Campbell