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Let the end-of-year prognosticating continue!

A few weeks ago I linked to a roundup of some forecasts for the coming year.

Here’s my own collection but with a twist — the questions I’ll be trying to answer and news I’ll be watching for on the housing and economy fronts in 2010.

Housing: Government Intervention: With major apologies to the themes of Rich Toscano’s recent posts, government and politics is the name of the housing market. It’s neither wise nor possible to parse through the government intervention and theorize about what the housing market would look like without it.

So, what am I watching in a government-infused market?

The three big pieces of government support (and some related dates to watch) are:

  • The homebuyer tax credit was extended ’til April and widened to be applicable to move-up buyers, not just first-timers, prolonging the incentives available to convince people to buy.
  • The Federal Reserve’s unprecedented investment in mortgages to keep the market going and to keep interest rates low is due to expire in March.
  • The Federal Housing Administration continues to back a significant number of loans locally.

Will federal lawmakers make FHA rein in its loan-making? Will the FHA’s imminent new rules ask borrowers to bring more money to the table? That could have big impacts here.

To recap, the big questions here:

How long can the government support last? And what is the government creating by picking up all of the slack created in the market?

A lot of people I’ve talked to worry the feds have not done anything to get the skittish private sector to start buying loans again, and the private sector’s not likely to keep interest rates as low as the government has.

Housing: What’s for Sale?

I’ll also be watching for what happens with shadow inventory — basically just the homes where people aren’t making payments or are in foreclosure, but they haven’t yet been repossessed and put on the market by the banks. When will those homes hit the market?

The number of homes on the market is incredibly low at the moment. Will that tight inventory continue?

Because the banks haven’t listed all of the foreclosures, there aren’t many homes for sale. That means people are fighting over the few homes out there, even though there’s this potential stock on its way. (This is where the word “bubble” has been uttered for some recovering markets like San Diego — prices are getting bid up on homes even though the underlying economic tenets don’t quite support a full-fledged recovery.)

Economy: Unemployment

As one of you pointed out recently, you can’t have a housing recovery without a jobs recovery. USD economist Alan Gin expects we’ll hit the bottom for the local economy sometime in the first half of 2010.

What did I miss? Let us know the questions you’ll be watching for answers to — leave a comment.

♦♦♦

And now, for a few of my highlights from 2009:

  • My investigation with my colleague Will Carless this spring, A Staggering Swindle, focused on a post-boom real estate scam in which Jim McConville used rented identities to buy 81 condos in Escondido and San Marcos in 2008, pulling $12.5 million from the deals. The scam left condos in foreclosure and exploited vulnerabilities in the home mortgage finance system, leaving U.S. taxpayers on the hook.
  • Even in Bankruptcy, Builder Tries to Browbeat Foes: I profiled prominent local builder Mick Pattinson, tying together a builder’s bombastic persona during the boom with his lament in the downturn.
  • Perplexed by SD Housing? You’re Not Alone: Even though this referred to a point in time, I heard from several of you that this one of my monthly DataParty stories proved a particularly helpful roundup of all of the different things to watch for in the market.
  • She Says ‘Go!’ and Makes the Opera Sing For May’s installment of People at Work, I got to shadow Mary Yankee Peters, the stage manager for San Diego Opera, as she cued and counted her way through an incredible operatic operation.
  • He Moonlights at Sunset, Becoming Lighter than Air: I’ve got to round out this list with another People at Work installment. Pete Brunner is an insurance broker by day, hot air balloon pilot at night — a peculiar balance he’s been striking for 20 years.

— KELLY BENNETT

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