A colleague and Banker friend of mine asked me to answer some questions about consumer confidence and the housing industry. I thought I would share my response.
The atmosphere in our country is poised for change. Based on recent polling numbers, our Nation is not happy with Congress or the current Administration. Being an election year we will see the usual ebb and flow of the temperature of consumer confidence. If the majority of people are pleased with the change in direction of our Federal Government we can continue to see consistent spending numbers.
I think the housing industry is recovering from a massive party. The industry enjoyed loose regulations, binge sales, and other reckless activities. The industry woke up with a massive hangover. The repercussions of the over indulgence flooded the market and tightened credit. As with any sharp pain there is an equally intense reaction in the other direction. 2012 will be the beginning of the new “normal”. Investors, Lenders, Real Estate Agents still remember the pain that was inflicted. There has been enough time pass that we have hopefully been able to look back and see where bad judgment was made. This will be the first opportunity to see if we can handle our lending and housing policies appropriately.