6. Projections for 2012
“For 2012, we are expecting better
housing numbers than in 2011, and
a better second half than first.”
IHS Global Insights
IHS Global Insights 2/13/2012
7. Projections for 2012
“A lot of housing and
macroeconomic data came in
higher than expected so far in
2012…while jobless claims
have fallen steadily this year
and indications on consumer
sentiment show Americans
may be ready to begin buying
properties again.”
Jason Philyaw, Editor, Housing Wire
Housing Wire 2/27/2012
8. Projections for 2012
“The US economy continues to build on the momentum
from the end of last year. Our outlook anticipates gradual,
but steady, improvement in the economy and the housing
market, supported by low interest rates and brightening
job market prospects.”
Frank Nothaft. Freddie Mac VP and chief economist
Freddie Mac 2/22/2012
9. Projections for 2012
“The improved tone of housing data
buoys hopes that the market may be on
the verge of its long-awaited recovery.
..Increases in new- and existing-home
sales over the last three months follow
stronger job creation and improved
affordability, including the overall drop
last month in conventional mortgage
rates to below 4%.”
Moody’s Analytics
Moody’s Analytics 2/27/2012
10. Warren Buffett Speaks Out
Is it time to buy real estate?
“If I had a way of buying a couple hundred thousand single-family homes I
would load up on them.”
Why invest in real estate now?
“It’s a way, in effect, to short the dollar because you can take a 30-year
mortgage and if it turns out your interest rate’s too high, next week you
refinance lower. And if it turns out it’s too low, the other guy’s stuck with it for
30 years. So it’s a very attractive asset class now.”
CNBC 2/13/2012
11. Warren Buffett Speaks Out
Is buying your own home better than investing in
stocks right now?
“If I knew where I was going to want to live the next five or 10 years I would
buy a home and I’d finance it with a 30-year mortgage… It’s a terrific deal.”
Should we buy multiple houses?
“If I was an investor that was a handy type and I could buy a couple of them
at distressed prices and find renters, I think it’s a leveraged way of owning a
very cheap asset now and I think that’s probably as an attractive an
investment as you can make now.”
Source: CNBC 2/13/2012
12. Mortgage Rates – 30 Year Fixed
5.25
5
4.75
4.5
4.25
4
3.75
1/01/2011 Today
Federal Reserve
13. Home Rents Will Keep Rising
“Paying rent is getting
$ 1 , 2 0 0
$ 1 , 1 7 5
more painful for renters
$ 1 , 1 5 0
$ 1 , 1 2 5
across the country in the
$ 1 , 1 0 0
$ 1 , 0 7 5
face of rising demand
$ 1 , 0 5 0
$ 1 , 0 2 5
and tight supply… $ 1 , 0 0 0
2009 2010 2011 2012* 2013* 2014*
It’s bad timing for people who have been spooked
by, or pushed out of, the residential housing market
and have decided to rent instead of buy. Home
ownership in the United States is at historic lows,
but at the same time rental prices are on the rise.”
MSNBC.com 2/6/2012
14. Buy Rent
Housing Cost Over
Next 30 Years*
$900K
$540K
Owners Renters
* Assuming payment of $1,500 for both rent and mortgage; a fixed
rate mortgage and an annual rent increase of 3.2% for inflation.
Forbes.com 10/13/2011
15. Buy Rent
Retirement Fund
Created from
Homeowner Equity
After 30 Years*
$400K
$0
Owners Renters
* Assuming $300,000 current value with a 1% annual appreciation
rate for residential property.
Forbes.com 10/13/2011