I made a list of ten predictions for 2008 back in January. I don’t think many prognosticators scored well this past year…I’m going to go through my list and see what my shooting percentage was…
Here are my 2008 Prediction results:
1. Housing Prices: Prices won’t fall much more than they have already. At least for condos and townhomes in north Seattle, we’re down 10-15% from the peak of spring 2007…
>>I like reading things were already rough a year ago. Makes me think an improvement might be nearer than we all suppose. I think prices are down a bit more though from Jan ’08. I’d guess another 10% from where I was in the last writing. Where do they go from here? Read my upcoming predictions! Grade: C
2. Rents: Will continue to rise, 8-12% this year in Greater Seattle.
>>Rents DID increase, on average about 6%. The landlord’s market continued until the stock market crashed in September, it was dead for any activity for two months, then our property managers got busy again. Solid B
3. Interest Rates: Rates are so good for conforming (up to $417k) loans. And they will get a bit better through the first two quarters.
>>Refinancing got good and is getting better. And rates didn’t get a bit better, they got way better…Grade: B
4. Lending: Speaking of loans, there will continue to be lots of news in this industry. Bank of America…will buy Countrywide in order to control CFC’s best asset: Its excellent retail distribution network. WaMu will recover both its reputation and its stock price. It will trade back in the mid 20’s by Fall.
>>I nailed this first part! BoA did buy Countrywide. But man, was I wrong on WaMu. I sold this stock, bought it, sold and bought it again…and sold it at .16/share to take the tax loss. Lots of widows and orphans also lost a ton of money in the “conservative” section of their portfolios. One reason why I love income producing real estate. D-
5. Foreclosures: While there will be lots of talk about PERCENTAGE increases being HUGE in our region, the real numbers will still be underwhelming.
>>Still not huge numbers in Washington. LOTS more short sales than foreclosures, which I suppose means more foreclosures are coming. We’ll have to keep an eye on these stats. B
6. Blogging:As much as industry blogs have exploded in the past two years, I think they’ve peaked. One can only read so many of these things and after a while the content seems a bit redundant.
>>I feel like this is coming true, or maybe I’m not reading as many new blogs as I used to…have fallen into a good rhythm of what comes into my Outlook RSS feed. A-
7. Seattle: The economy will continue to boom. Boeing’s 787 delivers this year, and from what I’ve heard and read, it’s going to be a great plane. Paccar is still selling lots of trucks. And of course the other great companies – Microsoft, Costco, Amazon, Starbucks, WaMu, Weyerhaeuser, Nordy’s, Safeco.
>>Wishful! Safeco is gone. WaMu gone. The first four are all doing “okay” I would say, all things considered, and despite SBUX’s closures. 787 not yet out the door. But generally, WaMu notwithstanding, I’d say our engines are all still running relatively well. C+
8. UW: I’m not really a big follower anymore, despite being a third generation Seattleite and a big fan as a kid. But I like the Dawgs, and I really like Tyrone. He’ll finally pull it together and will go 7-5; but they’ll lose to Stanford in Palo Alto in September.
>>Winless…way off there! But I always enjoy a rare thrashing of the UW by my alma mater…which did in fact beat the UW (but the venue was wrong…I was watching at Montlake this year). Good luck Ty, I think you’ll land on your feet somewhere. C
9. Seahawks: Will lose in the second round of the playoffs to Brett Favre’s Packers. The Pack will advance to the Super Bowl and will lose in a tight game to New England, which will finish the season undefeated. Favre will retire.
>>Seattle DID in fact lose in the second round…to Green Bay! The Pack, however, lost to the Giants in the next round. Favre retired, then unretired. B-
10. Sonics: I hate to say it, but I think they’re gone. Unless, and it’s a long shot, someone steps in and pays Clay Bennett $400m+ to leave the team alone AND the city plays ball with some renovation plans for the Key. Maybe there’s some local ownership that will make this happen. I’d put $100 on it given the right odds. Maybe 100 to one.
>>Gone. And it seems nearly forgotten! Not a lot of talk about the vacancy at the Key, except for the high hopes that they’ll land a reinvigorated SU program. A
Overall Grade for 2008: B-