Every year for the past four years I have asked local real estate professionals how they think the market will change in the year ahead. Here are this year’s answers.
John Christman, associate broker, Coldwell Banker. “I don’t think it will get much worse in 2008. I don’t foresee any dramatic change one way or other till 2010 at the earliest. If I guessed on any direction next year, I would say slightly down. Homes under $299,000, especially towards the mid 200s will sell; there’s always a market for that. Once you get to $399,000 and above, it slows down. And above $450,000, it falls off the cliff. It doesn’t take a mental giant to read that. I believe in 2010, once we have gotten into the new administration, we will see an upturn like we did 20 years ago.”
Jackie lewis, broker, Greentree Real Estate. “The real estate market is a little scary. The interesting thing is we have had more closings this year but less volume overall. So many sellers are refusing to lower their prices any more, they will just take homes off the market first. I don’t understand why, with interest rates low and such a high inventory, more buyers aren’t out there. I guess they are just afraid. I don’t know what it will take to get people back in the market.”
John Kilroy, broker, ERA. “2008 is going to be worse than 2007. I don’t see any light at end of the tunnel. Prices are going to come down, but how much, it’s hard to tell. Maybe another 10 percent. Homes selling in the $200,000 range will sell the best. People will find it hard to sell their new construction homes for what they paid for them. I don’t think sellers realize that prices are going back to what they were in 2002. The areas of the country that saw rapid appreciation will see rapid depreciation. We were doing fine when all we had was small builders, but now that the big developers have come, we have over-built everything. We’ve lost many buyers in the market, including speculators, builders, and, recently those with bad credit. When inventory gets down it will turn around. It might be late 2008. Some buyers have been waiting for the market to hit rock bottom. They may come back in the spring.”
Greg Didden, broker, Greg Didden Real Estate. “I’m going to be optimistic. We still have low interest rates. Shepherdstown is a market unto itself, and will not suffer from the sub-prime credit crisis. I expect that next year we will see a slow first quarter with much improvement beginning in the second quarter, and by third quarter, we will have made up for our losses in first quarter. Election years are typically years of activity in the real estate market. There is great hope, with somebody new in the White House. I think it’s going to be a very positive year. It will pick up in 2008, absolutely!”
Tim Procita, president and CEO, MVB: “I think the residential market will remain flat in 2008. What I see being built is small single-family homes and townhomes. This will continue in the new year. At the peak of the market businesses were willing to build a spec home. Now they are defensive, and are only building pre-sold homes. This will continue throughout 2008. I’m seeing a lot of commercial activity entering the pipeline, and I expect this activity will stay healthy.”
Chip Hensell, realtor, Hensell Real Estate. “We are in for a long cold winter. Prices should stabilize late ’08. Hopefully we will get through the foreclosure mess this winter. There are fewer houses going up for up sale, less inventory, which will help us. Then I think we will see the normal appreciation starting again in ‘09. I think the threshold for homes to sell today is $210,000 in Berkeley County. Anything above this is not selling unless it is unique. I think we may have a small decrease in home prices 2008, maybe five percent, but no more than that. Purchase of land for development has dropped about 50 percent in 2007; I’m not sure it can go much lower in 2008.”
Dave Pill, real estate, attorney. “I’m going to be a little bit optimistic. Elections are getting closer, and we feel like there will be change. This thing in Iraq may wrap up; the cars we are building are getting better on gas. I’ve got a feeling interest rates will come down a little bit. I think things we will start to move in a positive direction, though not with the fire and fury we’ve seen in the past—‘08 will be better than ‘07. Prices could have a slight decrease up to April ’08. After that prices will stabilize and start heading up. Hopefully foreclosures have peaked.”
Chris Colbert, loan officer, United Bank. “It seems that nobody is buying right now. This will probably last for some time. Nobody knows when it will get better. We need the inventory of homes to reduce. We have had increased foreclosures over the past few months; prices have gone down some. Commercial property sold well in 2007, and will do even better in 2008, especially around Charles Town and Ranson.”
David Brawner, manager, Brawner & Associate. “In terms of sales, we are still heading into a headwind. With house prices receding, we are beginning to see the reintroduction of buyers back into the market. We have seen an improvement in the market since November, as buyers are feeling more comfortable. We are also seeing more first-time home-buyers looking for homes. The most activity we are seeing is at the lower end, under $250,000. I think in 2008 prices will flatten out, and 2008 will be the same as 2007 in terms of volume. The biggest impact is going to be what lenders do to allow buyers to buy, and to stop foreclosures. It will be at least two years until things pick up again.”
