Boom winding down
David Lereah, the Chief Economist and seemingly head cheerleader for the National Association of Realtors, recently addressed the Marco Island Area Association of Realtors.
The market is actually returning to the more realistic level of the early 1990s, Lereah said Oct. 4 at a function hosted by the Marco Island Area Association of Realtors.
So instead of the 31 percent price appreciation that occurred on Marco Island last year, for example, these figures will eventually steady around 5 percent to 7 percent, he said.
Lereah said the end of the real estate boom represents air coming out of the proverbial bubble, rather than the bubble bursting.
"The real estate markets (across the country) are fundamentally sound," Lereah said, citing reasons beside lower interest rates — and a substantial refinancing boom — that first began to propel the market in 1992. These included:
— the emergence of the flush baby boomer market;
— the increasing buying power of immigrants over the past few decades; and
— technology both facilitating and reducing the costs of home ownership through more efficient business processes.
It is refreshing to hear Lereah speak realistically about the state of the market. I think most us involved with real estate need to properly set expectations on a going forward basis. While this may be a painful process for some, it is a neccesary one.Top economist: End of boom won't doom real estate market [Naples Daily News]