We hear about all the negatives about the Housing Market I read this article in the
USNews.com that shed some positive light!  The article below gives us five (5) reasons to be
encouraged about the Housing Market.  For those of us who think it is not a good time to
Buy or Sell, read the article below for those positives in 2009.

Top 5 Housing-Market Hopes for 09!!!

As in reference to:  USNews.com

Here are the five best reasons to be hopeful about housing in 2009:

1. Cheap mortgage rates: With inflationary pressures easing and economic concerns mounting,
   shell-shocked investors are seeking the protection of government securities,such as 10-year
   treasury notes, driving down yields. The lower yields, coupled with the Fed’s recently announced
   plans to buy up debt and mortgage-backed securities from Fannie Mae and Freddie Mac have
   dragged mortgage rates to multi-year lows. Thirty-year, fixed mortgage rates hit an average of
   5.47 percent last week, the lowest they’ve been since 2004, according to Freddie Mac. 

   To be sure, not everyone will be able to take advantage of these attractive rates: Tougher lending
   standards will prevent many would-be buyers from getting into the market, while homeowners
   whose houses are now worth less than what they owe on their mortgage won’t be able to
   refinance. Still, the rates present a welcome incentive for qualified borrowers to step up to
   the plate. “Lower mortgage rates mean more people with those credentials will be able to qualify,”
   says Patrick Newport, a U.S. economist at IHS Global Insight. While that might not make a
   dramatic impact on the market, it could be enough to keep home sales from declining as much as
   they otherwise would, Newport says.

2. Lower prices: Home prices at the national level have already fallen 21 percent from their
   2006 peaks. And in certain bubble markets, the crash has been even steeper-prices have fallen
   more than 30 percent in Phoenix and Las Vegas over the past year alone. Although that’s a big
   blow to homeowners-the housing bust is expected to wipe out more than $2 trillion in home
   values in 2008-lower prices do help stimulate buyer demand, which is badly needed to mop up
   the excess housing inventory. And while home prices are expected to drop further in 2009,
   values in certain markets are already at levels low enough to tempt bargain hunters. “Falling
   home prices aren’t part of the problem, they are part of the solution,” says Mike Larson,
   a real estate analyst at Weiss Research.

3. Fewer housing starts: In the face of dwindling demand, home builders have been forced to
   sharply pull back on new construction. The government reported Tuesday that November
   housing starts dropped to their lowest level since 1959, when officials started keeping the
   statistics. While that’s bad news for the economy-because it means fewer jobs for builders and
   others-it’s an important step in bringing housing supply back in line with demand. The cutback
   will limit the supply of new homes coming into the market, which helps to reduce the glut of
   unsold homes that is putting such downward pressure on housing prices. “In order to get rid of
   the inventory, builders have to cut back even further and prices have to drop,” Newport says.
  “It’s very painful, but there is no way to get around the fact that that’s what you need to do to
  equilibrate the market.”

4. Obama stimulus: In an attempt to hoist the economy out of its rut, President-elect Barack
   Obama has announced plans for a massive federal spending program. The initiative is expected
   to put between $500 billion and $1 trillion into infrastructure repair and other projects in an
   effort to keep Americans working. Should this program succeed in preventing unemployment
   from skyrocketing and keeping the economic contraction from hitting the dourest projections,
   certain housing markets may firm up quicker than expected, says Susan Wachter, a professor of
   real estate at the University of Pennsylvania’s Wharton School of Business. In the best-case
   scenario,“the housing market declines become contained to those markets where house price
   declines are significant,” Wachter says.

5. Credit programs: It will be tough for the housing market to come back to life until the credit
   markets-which have been log-jammed by fear for more than a year-begin to unlock. Like the
   fight to limit unemployment, reviving the credit markets is a daunting challenge. But remember,
   the federal government has already taken a number of steps designed to do just that. The Federal
   Reserve has slashed its benchmark interest rate to between 0 and 0.25 percent and committed
   nearly $2 trillion to new lending programs, bailouts, and additional measures designed to bolster
   the financial markets. Meanwhile, Congress passed a $700 billion bailout and the Treasury has
   already injected a chunk of that money into banks of all sorts. While these efforts haven’t been
   enough to restore the credit markets to health, they have produced results. Interbank lending, for
   example, has eased. And should this modest victory lead to a broader recovery in the credit
   markets, the economy-and the housing demand that comes with growth-could turn around
   quicker than expected. “Right now, panic is driving the credit markets,” says Moody of Mission
   Residential. “If, for whatever reason, confidence were to resume and people’s appetite for risk
   was starting to increase, then you could start all of a sudden seeing credit flowing much more
   freely, which obviously supports spending in both business and households.”

Posted by:  Donna R. White