Christmas is over, the guests are gone, and it’s time to get back to work for me after several days of feasting (ok, the leftovers may be here for a bit!). I may also get a day of skiing in yet, but my focus for this week will be on getting 2010 off to a good start. With the Broncos teetering on the verge of eliminating themselves from the playoffs, it should actually get easier to focus, since I really don’t have a 2nd team I root for 🙂
I am not an economist, and don’t want to pretend to publish a true economic forecast for Colorado Springs, but for 2010, there are several things that are pointing to a better year for Colorado Springs real estate. Some of them are:
- Unemployment looks like it has peaked, and at least locally has already improved (7.2%), with signs the Colorado Springs economy will be stronger in 2010.
- The extension and expansion of the homebuyers tax credit ($8,000 for 1st timers, $6,500 for others who may qualify) should add a little ‘juice’ to the 1st quarter anyway. The program expires April 30, and hopefully by then we’ll be into a little stronger spring season to help continue momentum.
- Interest rates, while they may not stay as low as they are currently (high 4’s, low 5’s), will probably not get out of the 5’s for a while yet.
- We do not have a glut of homes for sale in Colorado Springs, which positions us well for recovery in terms of home prices. As home prices strengthen, the equity of local homeowners who have wanted to move up will rise, enabling them to move up and giving some badly needed help to the new home construction industry.
There are certainly still some clouds still on the horizon, so this New Year celebration may be a little subdued in the Colorado Springs real estate industry. Some of them are:
- Many of our buyers come from outside the area, and continued problems around the country will ‘slow the flow’ as people either can’t get liquid from selling their existing homes, or can’t qualify to buy a home here while they wait for their current home to sell.
- We have a fair number of people who have been credit damaged or equity depleted in leaving their current situations, further shrinking the pool of eligible buyers. This is exacerbated by the tighter lending rules we have been living with for a while.
- There is a wave of adjustablerate mortgages scheduled to rest in the next 6 to 24 months, that will feed the foreclosure problem when people get the bill for their new, higher payments. I may devote a separate blog to this in the near future. We don’t expect this to be a huge problem locally (Option ARMs were not so popular here), but this will affect some of the areas that people come from that want to move here.
- Continued deployments to Afghanastan by Fort Carson based troops may throw a wet towel on our on our hopes for a stronger year.
Here’s to 2010 – may it be a better year for you and yours as well!