The “Oracle of Omaha”, Berkshire Hathaway’s Chairman Warren Buffett, went on record Saturday in his annual letter to shareholders stating that residential real estate market problems will be substanitally behind us within the next 12 months:
- “[Within] a year or so residential housing problems should largely be behind us, the exceptions being only high-value houses and those in certain localities where overbuilding was particularly egregious. Prices will remain far below “bubble” levels, of course, but for every seller (or lender) hurt by this there will be a buyer who benefits. Indeed, many families that couldn’t afford to buy an appropriate home a few years ago now find it well within their means because the bubble burst.”
Even though Buffett didn’t specifically mention the Lamorinda real estate market, this a reassuring prediction for those who have have been sitting on the sidelines waiting for the market to bottom. As I have said before, one will never know the market has bottomed until it heads up and we are looking back. Although there are dire predictions of a “double dip” in the market due to forthcoming foreclosures, it appears thus far that those predictions have been over-stated and we are presently bumping along the market’s bottom… with relatively normal seasonality. If Buffett is right… and he usually is… 2010 will be a very good time to be a buyer of real estate.
The “official” market stats have not been published yet by the various MLS boards, however that doesn’t mean we can’t take an early peek at the Lamorinda market for the month of February:
- 162 homes “Active” on the market compared to 172 homes in 2009.
- 78 “Pending” in escrow compared to just 21 in 2009!!
- 28 “Sold” with closed escrows compared to just 12 in 2009!!
These aren’t the “official” stats, however I don’t expect that there will be much variation from what the Contra Costa Association of Realtors publishes in the coming week. Clearly, 2010 will be a MUCH better real estate year than 2009. It is also clear that we could begin to see some firming up of prices, and perhaps some price increases in certain segments of the market. More about this in subsequent posts…
