Tuesday, September 25, 2007
Is that light at the end of the tunnel?
There’s no doubt that we’ve been in a long, dark tunnel in real estate in Michigan for the past year or two. That fact has been well documented in the papers and on the newscasts and even here in earlier posts. What is not yet being widely reported is that there are glimmers emerging from the darkness lately that may well presage the light at the end of this tunnel. I started seeing them and reporting on them back on August 13 (see my post about Looking for Rainbows). Just from a personal perspective I’ve picked up more buyers lately – more people who are out doing serious shopping for houses. I’ve also seen an up-tick in the flyer traffic at my listings – people taking flyers from the boxes at the houses. Even the showings have increased a bit and more of the current lookers are actually making an offer on something.
Now, I’ve seen an article or two in the newspapers or the weekly news magazines, written by economists or industry gurus that are starting to say positive things and note changes in the trends that portend a turnaround. I, for one, have certainly had my fill of the darkness and would welcome a more normal, more balanced market. I’m still showing a lot of foreclosed houses to people, but at least there are buyers out there going after these great deals. If they can’t find a foreclosure, many find a normal home for sale at a great price and go ahead with their plans with those houses.
We still have a rough patch to get through, with the current ARM resets about to cause another round of foreclosures; however, we may be getting more like Wall Street, were they regularly report things like, “the Street had already factored the end of the world into the market, so the was no panic at the release of that news today.” Maybe the real estate market has already factored in the next wave of foreclosures, so that will not cause more than a minor blip. I certainly hope so.
I don’t expect to emerge from this tunnel into a world that looks like the world was when we entered on the other side. As I said in my post “Nostradamus I’m Not” of September 17th, the new normal for Michigan is not anything like the old normal when we entered this tunnel. That’s not necessarily bad, just different. It’s something that will take some getting used to and which will require a whole lot of adjusting of expectations. I’m busy trying to adjust my business to this new reality – showing lots of smaller, less expensive homes, focusing on foreclosures, and trying to help sellers do the necessary things to market their homes in this new reality.