I get asked this question a lot these days.  A lot of the news on T.V., newspapers, and radio are feeding the general public with nothing but gloom and doom.  Sure, the market is down in Greater Cleveland.  But we never went up as high as Florida, Nevada or Califorina.  Satistically, there were 2500 or so less houses sold in 2007 than the previous year.  We are coming off record breaking years.  Look at the stats provided.  New listings up 8.9%, sold listing down 9%.  Avg sale price down 4.6%. 

There are a lot of sellers out there. There are a lot of buyers out there too.  Most of the sellers need to sell their existing home to move up to their next home(thus becoming buyers too).   It’s a chain reaction that is missing one piece of the equation.  The first time buyer.  Where are they?  Where are the buyers who are supposed to buy the Cleveland homes, Parma homes, Garfield Heights, Cleveland Heights, Lakewood and other inner ring suburban homes to unleash those sellers to become move up buyers.  Interest rates the other day went down to 5.35% on a 30 yr fixed conforming.  You would think that with prices so low and rates so low, they’d be coming ut in droves.  A few did, but I know I’m a net buyer right now.  Sure the lenders are being ultra strict these days and for good reason.  But these buyers started to disappear well before June of 2007 when the lending standards tightened up.

There seems to be some underlying reason.  Is it our local economy.  If so, any statistical representation of it.  Could it be that we are way over built.  The census shows us actually growing a bit in population.

People in general always do the opposite of what they should be doing.  When everyone was buying tech stocks in the ’90s, they should of been selling and buying real estate.  When everyone was buying real estate in early 2000’s, they should of been selling and buying stocks.  It’s a roller coaster ride that I believe run opposite of each other generally speaking.

Any comments or questions…