There is no one that wants the housing market to recover more than I do. Over 50% of my investment portfolio is comprised of real estate. My job is to teach real estate professionals what is happening in the market and why it is happening. It would be a lot more fun if I could tell them the housing market is about to come roaring back. I would be lying if I did.

All indications are that the real estate market will remain soft for some time to come. It will be better for everyone if we accept that fact and move on with our housing plans accordingly. Over the last week, there were three major reports released that prove that many people are still unclear as to the severity of the market:

SALES

Each month the National Association of Realtors (NAR) puts out their Pending Sales Report which measures the number of existing homes that went into contract the previous month. Based on the expiration of the Home Buyer Tax Credit, everyone expected the June report would show a substantial decrease in contracts.

Bloomberg News surveys economists each month prior to the release of the report to establish what the economists assume NAR will say. For the June report the economists predicted it would show a 14% decrease.

The actually number was a decrease of 30% - over twice what the economists had predicted!

PRICES

MacroMarkets LLC has just started to release a monthly survey of the leading 106 economists and analysts. They asked them to determine whether home prices will increase or decrease for the rest of this year. The first month of the survey (May) found that only 40% of those participating felt values would decline. The number jumped to 56% in last month’s report (June).

An additional 16% turned negative on future home prices in the last 30 days!

These are the top analysts and economists in the housing industry and they are starting to become much more bearish on any housing recovery.

CONSUMER CONFIDENCE

In a Wall Street Journal article titled Consumer Confidence Appears on the Mend which appeared on the morning of Tuesday, June 29, 2010 it was reported:

“Surveys of U.S. consumer confidence are closely watched on Wall Street, thanks to their decent track record in foreshadowing recessions. That makes them particularly relevant now as investors work to gauge the odds of a renewed downturn. But while confidence is certainly fragile, it isn’t behaving as if another downturn is at hand.

Today, June consumer-confidence figures are due.

Economists expect the index to post a small retreat to 62.5 from 62.7 in May.”

Sounds great! However, here are the actual results that came in later that day:

“Consumer Confidence Index^® declined sharply in June. The Index now stands at 52.9, down from 62.7 in May.”

One of the most reliable of sources for financial news (WSJ) got it completely wrong. The index fell 9.8 points, not 0.2 points!

What does this mean to you?

When you hire a real estate professional (either an agent or loan officer), don’t hire someone who is hoping the market will turn around. Hire an expert who understands what is actually happening and will take the time to sit down and explain it to you. That is the only way you can feel confident that you are making the right choices for you and your family.