Looking Into The 2010 Real Estate Crystal Ball
Looking ahead to the 2010 Real Estate Market in Rutherford County, John makes his predictions regarding what we can expect the local housing market has in store for the coming year.
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Transcript
JOHN: Hey, guys. John Jones here with a new decade edition of Tuesday Morning Coffee. Guys, I hope everybody had a Merry Christmas, a Happy New Year. I got a Kindle for Christmas. I’m excited. I’ve read three books and none of them have pictures. So I know the people that know me out there, that’s a good thing. Also, I wanted to throw out a cool book, especially for business people, entrepreneurs, a book I just read called Crush It! by Gary Vaynerchuk. Awesome book. A social media wizard.
Guys, let’s talk about predictions for 2010. First of all, I want to give a shoutout to Chris Johnson, 2,000 yards. That’s awesome. One of my predictions for next year is he’s going to do it again, back to back. Okay, let’s talk about housing. 2009, we ended up 2% less than we did last year. We’re still about 50% off of what we did in ’06, which was our pinnacle year. But the numbers we did this year are pretty in line with the same amount of homes that we sold in Rutherford County in the year 2000. And you know what? I remember the year 2000 being a good year.
So we can’t get too down about that. I don’t know that we’ll ever see the levels we saw in ’06 again. It was crazy. Everybody can get money. Last Tuesday, the Case-Shiller Index came out, and the Case-Shiller Index is this: It’s an index that takes the top 20 cities and it’s seasonally adjusted for pricing and values, home values across the nation. End of October, home values were up four-tenths of a percent. It’s the fifth straight month home values have come up according to that index. It’s still down 7.3% across the nation, national average 7.3% for the year. But this is nowhere near the steep declines we’ve had the last couple of years.
So that’s a good thing. It shows me that value is stabilizing across the nation. The stock market was up 10,583; the Dow 10,583 at the close today. Guys, March the stock market was at 6,500. So that’s a good thing. Consumer confidence is up, 52.9% up from 50% in November. The consumer confidence this time last year was around the 40% mark. So people are feeling better about the economy. That’s a big deal. In Rutherford County, our unemployment’s around 9.3%. Earlier this year, that bugger was up in the 10s. I think around 10.3, 10.4. That’s good. That’s coming down. That’s a very important number.
It’s the key indicator. Employment is the key indicator in the housing market. People are asking, “John, when are values going to go up?” I’ll tell you when values are going to be going up, and I know I’m going to be right on this one. When you see the unemployment get down in the 6s, guess what? You’re going to see the real estate market starting to go. People have to have jobs to buy homes. Rates still remain at historically low levels. So that’s a cool thing. A writer from the Wall Street Journal, they did a home affordability index, and he went back to 1987.
He used home values across the nation, weekly earnings, and mortgage rates. And he says right now homes are as affordable as they have been since the mid-90s when real estate was a real steal at that time. So guys, all of these things are telling me that things are going to look better. My prediction for next year: We will sell 10% more homes in Rutherford County next year in 2010 than we did in ’09. You’ve got it on tape. It’s documented. So we can look at it next year and we’ll see if I was right or wrong, but think about all the positive things I’ve said today. We were saying none of this stuff last December.
Everything last December, last January was negative, negative, negative. I quit watching the news because of it. Things are a lot more positive. We’ve still got a ways to go. It took us time to get into this mess; it’s going to take us some time to get out. But I feel a heck of a lot better about things overall than I did this time last year. Thank you. Call us if you need us, 867-3020, or JohnCJones.com. Thank you.
