I watched the Inauguration this morning, full of new hope and expectations for the coming years, and with the realization that it won't be an easy turnaround.
President Obama’s economic aids assure that the incoming administration will be responsible with its spending of the Troubled Asset Relief Program (TARP) funds and pledged to commit some $50 billion to $100 billion to address foreclosures.
As we well know, one of the biggest challenges currently affecting our market is the difficulty of even the most qualified buyer to secure financing. The goal of TARP is to open the housing and financial system so buyers—especially those with good credit—are able to once again secure financing.
Several weeks ago, I mentioned that real estate was in one of the best positions, industry wise, for a correction. This is thanks to the fact that lawmakers realize that housing makes up 20% of the GDP, and our economy can't be fixed without fixing the housing sector. With Obama’s recent outreach to Congress and the TARP funds now available, we’re starting to see the first of several outreach efforts to fix the hard hit housing industry.
This won’t happen overnight. We’ve got a long road ahead and depending on what forecast you are reading, some say we’ll start seeing a turnaround in mid-2009 and others say we may not see it until 2010, but the good news is that we are on track and our country is finally moving in the right direction.
Now, on that positive note, let’s take a look at this week in real estate:
In our Cupertino-Sunnyvale area, the first week of 2009 showed an increase in listings and sale pending transactions. It’s hard to know if this is the start of a trend or just coming off the cooler holiday months. This of course will be a market I'll continue to watch over the days and weeks ahead. The San Jose market continues to be driven by REOs and short sales.
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