"A baby boom is expected next year, The Year of the Dog according to the lunar Calender, meaning there should be huge demand for nurses who look after children during the first month after deliver, or yuezi ayi as they are known in Chinese. The expected baby boom is the result of an ancient Chinese superstition. Many people in the country believe zodiac signs can affect a child's personality, so they prefer to have children in the years of the tiger, monkey and dog."
OK, that's in China. In the U.S. during the year 2005, we saw the market transitiioning from hot, hot sellers market into a more calm and balanced market.. yogi like market. Sellers' new slogan for 2006, "Buyers: We Want You!"
While bubble related blogs are popular now, I don't believe that housing market is going to disappear anytime soon. That's for sure. People still need shelter. It's one of the necessities in life. People are still coming to Metropolitan Washington DC, because it is not only the place where most of the federal dolllars are spent but also one of the gateways for new comers, including immigrants.
Here is what I think (IMHO) are the 8 Things to watch in 2006 on the home front:
- Mortgage interest deductions. It's the deduction you get when you pay your mortgage. When Congress is back on session next year, the M-I-D will be one of the items to eliminate in a way to decrease federal budget.
- Energy-efficient homes. When customers see their heating bills increased by 20%+ this winter, it will make them appreciate the things around the house that can help them save money on their heating bills.
- Dog houses makeover. In the hot housing market, buyers would pay high prices even for not-so-well-maintained homes. In dog year, dog house hunters wouldn't come close sniffing, unless it's been undergone some makeover. Repaint. De-clutter.
- Health concious, living well style. More people are paying more attention to green-building, living using natural products and other green products. Feng Shui goes mainstream.
- Next wave of kitchen appliances. Beyond stainless steel appliances will be making their way in next year. Bronze appliances, anyone?
- Exotic loans replace by more traditional loans. With all the bad raps about exotic loans, it looks like consumers would rather take more traditional loans like fixed rates or ARMs.
- Smart growth. Mixed-use development that take advantage of smaller parcel of land in exchange for increase density to create walkable neighborhoods will remain popular. Town centers for live/work life style. Developments around VRE stations. Developments close to Metro stations.
- Seller's incentives. The long gone (at least for four years!) incentives are back. You will see that sellers help with closing costs that were unheard of in the hot market will be back as part of the home purchase deal. In a slow market, lease option will be an alternative to sell the property.
Best of All...Happy "Woof" Year!
* U.S. Growth May Hinge on Businesses [NYT]
* Snow: Raise Debt Limit [Calculated Risk]
* Housing: Exotic Loans, Regulations and Foreclosures [Calculated Risk]
* Beyond Stainless, New Kitchen Appliances [Real Estate Journal]
* Walmart Attempts of Going Green [Natural Home and Garden]
* As the Year Approaches, Some Predictions for Local Real Estate [Washington Post]
* Clean up the Clutter, Price the House Right [Washington Home Guide]
Image: Locketown Chinese Horoscope.