There is a silver lining to the "dour" Arizona real estate market and economic outlook reported yesterday by the AZ Republic.

I need to put my two cents' worth into the discussion on the Real estate Market after a deceptive heading appeared on the front page of the AZ Republic 12/6/07.

The headline checks out: "Housing market duidetails struck more difficult than analysts anticipated".

Recently I attended a workshop provided by among the financial experts quoted-- Elliot Pollack. I make sure he wasn't thrilled that his 120-screen powerpoint presentation was come down to the following quote: "There is no quick fix. We have a long way to go. Boy, it's a mess."

So here are my certifying comments:

The "hard hit housing market" refers to the truth that brand-new house real estate permits are down 30% instead of the projection 17.7%. Certainly this will have a result on the overall economy, but it is only one of 10 major aspects. The majority of the others are up due to increased exports (due to the falling dollar), and industrial and business projects increasing all over the Valley.

However this drop is in fact a good thing. The reduction in "new starts" will help reduce the supply-and-demand gap in the existing housing market that has actually produced an 18-month inventory Valley wide. (The stock is currently at 10 months in Tempe.) As supply goes down and buyers realize the sky (houses rates) is not falling, sales will pick up. What Pollack was referring to when he stated we have a long method to go is that it might not be until late 2008 that we see a reverse, and 2-3 years before we get back to regular.

Foreclosures might decline:

Another unknown element and potential cause for concern simply ended up being a little bit more confident. Foreclosures could increase the supply side of the housing stock, however the variety of foreclosures may decrease if today's news (December 6) is proper. President Bush will be describing a plan to freeze the rates of interest hike on sub-prime and variable interest loans.

Another glimmer of hope:

For the market to get back to "regular" (pre 2004-2005 costs and conditions), the stock of houses for sale requires to come down from the current level of 58,000 to approximately 35,000. For the last 3 months (September - November) the inventory has actually not increased, recommending that, if the rate of foreclosures does not increase, we may see a consistent decrease in the inventory after the seasonal holiday slow down. The other essential beneficial indicator that will assist reduce the resale real estate stock is that the job and population numbers are still putting Arizona in the leading 5 markets in the nation.

Stay tuned ... Weighing in on the media spin of the housing market (i.e., whatever will sell documents) may become a regular function of my blog site. Make certain to visit my site to find out more about the changing market in Tempe, Arizona.