2020 Boise Idaho Real Estate Blog
How Confident Are You in a 2009 Turnaround? Main Boise Home Builder
As a Builder Home Builder, I know Im supposed to be informing you about building. But to help me do that, I am asking you to inform me about you. Trey recently asked you when you thought the Boise Real Estate Market would recover. As a Builder in the Boise, Idaho MSA and an instructor for the National Association of Home Builders Institute of Residential Marketing, I would like to ask you a few more questions so I can better understand our local housing market and, more specifically, you the home buyer.

An article on CNNMoney.com last Friday discussed the results of a national CNN/Opinion Research Corp. poll which found that 60% of respondents think economic conditions in the United States will be "good" next year, as opposed to the 75% who think the economic situation is "poor" now. 

Because I believe that all real estate is local and I also believe that the all of the negative news regarding the national housing market and the mortgage industry is negatively impacting our local housing market, and because if you are reading this blog post you are either a potential home buyer and therefore a potential client, or a building industry professional, I would really like to know what you think. I am co-instructing an Institute of Residential Marketing course in Boise later this week on Marketing Strategies, Plans, and Budgets and I would really like to be able to offer the students some local data, even if it is non-scientific.
Of the more than 1,000 American adults surveyed in the CNN/Opinion Research Corp. poll, 83% said they are "confident" that they will be able to maintain their standards of living next year, and 85% are "confident" they will keep their jobs over the next six months. How confident are you that you will be able to maintain your standard of living next year and will still have your job over the next six months?
Americans also showed faith that they would be able to pay off their future debts, with 90% of respondents demonstrating confidence they would be able to meet their monthly mortgage payments for the duration of the mortgage. How confident are you that you will be able to meet your monthly mortgage payment for the duration of the mortgage?
An economist for Wachovia quoted in the CNNMoney.com article stated that for the more immediate future, he thinks consumers are right to be confident.  Do you agree?
Thank you for taking the time to respond.
Chuck Miller
President / Builder - Chuck Miller Construction Inc.


Posted by Chuck Miller at 3/22/2008 8:04:00 PM
Comments (3)
Re:How Confident Are You in a 2009 Turnaround?
Compliated situation. If you believe that all things roll down hill we may be at the begining of somthing painful. Builders are building less which affects so many people directly (suppliers, subcontractors, developers, realtors, title comps, mortage loan people) and then it affects us all in terms of others making less (those directly affected not spending money on food, dry cleaners and many business related expenses). If new construction picks up the economy will stabilize but there are so many ifs- gas prices, energy costs and so on. It is very stressful if you really study the #'s. Of course #'s say what you want and right now it is beautiful outside so i am headed out to play!
Posted by on 3/22/2008 3:06 PM
Re:How Confident Are You in a 2009 Turnaround?
Housing is 'in many ways' a commodity. You need only watch 2 major factors IMHO. Supply and demand, and 'speculation'. (This is idenitcal to other markets like gold, wheat, etc... except with a big liquidity difference.)
1. Supply and demand- As long as the 6 mnth moving average for inventory is trending up, suppy is exceeding demand and prices will tend to fall. We are a ways from getting this indicator to a level.
2. Speculation is being wrung from the market. We will again see the day when you need 20% down, credit and proper debt ratio 36% to qualify. This is resulting in the descruction of speculative investing.

I laugh all the time at housing prices in Boise even now. We don't have the income to support the whole upper 50% of this market.

Oh, another good clue is just graph prices over the last 25 years. Housing should match inflation over the long run. The last few years are a joke.

I expect 10% lower prices by 2011, which is more like 18% in inflation adjusted real dollars. I expect foreclosure sales to outnumber normal sales for the winter months of 2008-09.
Posted by on 3/25/2008 7:03 AM
Re:How Confident Are You in a 2009 Turnaround?

"A Wachovia analyst..'consumer have a right to be confident...'"


Full disclosure. Heavily short Wachovia. I think it is a Bear Sterns in waiting and rumors are they have been hat in hand several times at the FED TAF auctions. IF ANYONE NEEDS TO PUMP the economy now its them...if their stock goes down much more they will violate capital levels again and need to fire sale assets.
Posted by on 3/25/2008 8:45 AM
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