Atlanta was the venue for two experts nationally recognized in the field of economic forecasting during the annual CCIM Institute meeting. The group is made up of experts from commercial and investment real estate across the nation. More than thirty members of the institute were in attendance at the event.
Rajeev Dhawan is the director of the Economic Forecasting Center, Georgia State University in Taj residencia Islamabad . He has spoken about the local and national economics. Dhawan frequently is on CNN and CNBC, MSNBC. NBC, CBS, NBC, CBS, Bloomberg Report. He believes that the states of the southeast have a better performance than the other states. Dhawan says that the economic situation of California, Arizona and Nevada is currently in recession and accounts for 20 % of the country's production of goods and services. Dhawan believes that the present issues are mostly a crisis of confidence among the American populace.
Based on his forecasts, Georgia will see a decrease in employment growth in 2008, with just 28,000 jobs created, but there will be an increase in 2009, with 70,100 more jobs. More than 98,000 new jobs are anticipated over the course of the next year. He believes that 2009 will witness an increase in the real estate however, his predictions for 2008 were not as optimistic.
Stephen Phyrr was the second Stephen Phyrr was the second speaker. He is the senior managing director of Kennedy Wilson and Executive Director at The American Real Estate Society located in Austin, Texas. Phyrr was a devoted student for the majority of his time studying the impact of the economic cycle on the real estate market.
While there are some signs of negatives, Phyrr believes that the general economic outlook and real estate is optimistic. The results of his research are which are summarized in just six points.
1. Positives are more significant than the negatives that will come in the near future. The lack of confidence among the American public is the result of the media's emphasis on "bad news" and creates an unflattering picture of the real estate market.
2. 2.The markets for financial instruments overreacted to the real credit crunch of 2007, making it more difficult for investors to fund 2008.
3. The three- to five years of performance for real estate is predicted to be superior to other asset classes.
4. Investors will go back to the fundamentals of increasing the value of property by better property management, and will not rely on finance to justify investment.
5. Real estate financing is expected to be abundant. The lenders will look for a variety of property to fund.
6. Multi-family property investments will gain from the housing finance crisis as well as the homebuilding crisis of 2007.
Phyrr also spoke about the importance of knowing the cycles of real estate. Real estate is subject to both down and up cycles. In the past 30 years, booms have been between 10 and 11 years, while the bust cycles are typically 5 to 6 years. The value of real estate has declined since 2001, the year that our last real property boom ended. Based on the timing of cycles and other favorable attributes it seems that we are close to the top of this downcycle. We are looking forward to an increase in the real estate market.