I am going to repeat what I stated in December’s year-end letter, as I feel strongly that liquidity in the markets is very important for 2009. “I believe resales will have year-to-year monthly increases starting at the end of the 2nd quarter with new construction following two quarters later or the end of the year.

How much we improve will depend on how effective our government will be to improve liquidity and the ability to lend for our real estate industry.

If our financial markets fail in the ability to fund and fund all-types (conforming, non-conforming, jumbo, etc) of mortgages, it will be a very slow upward turnaround.”

I am presently looking for the good in bad news. I had a good year last year, and I am trying to scratch out a living this year too. I believe there is a lot to be said for the power of positive thinking. If prices are at the level that they were in the late 1990’s that is great for the buyers looking for a deal. Granted the homeowners who purchased in the past three years and have to sell are in the proverbial pickle barrel. The media does not help the situation with the constant barrage of negative press. I believe that networking is a powerful tool and a lot of good can come from the experts in our field banding together to help educate the homeowners of the options available to them in a crisis. The following is an excerpt of a report I receive, from smart numbers, concerning the Atlanta market:

There were 2,520 closings for all single family housing in January or a decline of 24.3% from January 2008. We would have to go back to January 1998 to find a month with less closings than we had in January.

There were 2,220 closings for single family detached in January. This is a reduction of 22.1% from the same period a year ago and the 29th monthly year-to-year decline out of the past 30 periods.

There were 300 closings for single family attached in January. This is a decline of 37.6% from January 2008 and will mark the 12th monthly year-to-year percentage decline of 25% or more out of the past 17 periods.

The average closed prices that are being reported for January are almost unbelievable. Many areas, property types, etc have average and mean closing prices that are back to late 1990’s levels. Prices have not corrected, but have collapsed.

The average sale price for all single family closings in January was $181,799. You would need to go back to February 1999 for a lower average price. January’s average is also $90,000 below the all-time high from June 2007.

Smart Numbers © 2009 Smart Numbers

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