People often ask me the “crystal ball” question, “What do you think the market is going to do?” I check off the many indicators I watch, including unemployment, demand, and inventory.
I then follow up with one of the most important indicators, “What do you think the market is going to do?”
In 2008, Austin’s real estate market was relatively healthy but flat. We saw slight appreciation in the median price. However, when speaking with clients & friends not in the business, it was their impression that the sky had and was falling.
Luckily, in Austin, the sky didn’t fall, but it did drop. Home prices have depreciated slightly in 2009. There are many factors that combine to cause this, but the public’s general impression of the market is a big one.
Since all real estate is local, it seems a bit counterproductive to watch national real estate trends closely. Moreover, local economies vary greatly from market to market.
However, watching national news & real estate trends does serve a purpose in that it helps you gauge your local buyers’ & sellers’ perception of the market. Gallup does a great job of measuring perception on a national level.
Economic outlook perception is one response that I feel is poignant in predicting both the general economic state, and real estate market. Industry polls & reports, such as those that HomeGain provide are another great resource.
However, one of the best indicators is to simply keep your ear to the ground, and ask others, “What do you think the market is going to do?”