Leslie McDonnell: As long as prices don’t increase too quickly it should remain relatively stable.
Dan Wagner: 2016 is an election year, where we will usher in the 45th president. A lot of eyes are on that decision, as the election outcome could determine possible changes in economic policy.
As to future challenges, global affairs play a huge role in what the economic picture in 2016 will look like. What happens with the fight against terror has an impact, and you can’t determine what will happen with the turmoil overseas. The increased security threat posed by terrorism is a real concern, not only for safety reasons but also for the potential economic damage that could result.
I’ve spoken to many people. Like me, they are confident going into the next 12 months. We are blessed to live in a great city, in the best country.
That said, the financial situation that faces both Illinois and Chicago is worrisome as it drives the headlines that make businesses question whether or not the state is a good place to stay or locate. The longer the budget impasse continues, the more potential there is for long-lasting damage to the housing market and the business community as a whole.
Of course, the increased property taxes in Chicago will have some kind of impact; it’s too soon to know just how much, because we don’t know the full weight yet, and probably won’t until the summer. The impact will be heavier on the commercial side than the residential. There are many questions, and the Chicago Association of Realtors continues to monitor the situation in Chicago, Cook County and Springfield.
Lynn Madison: The housing market and the industry in general took a big hit , obviously, in 2007 and ‘08. The correction that created more stringent underwriting and other issues – we’ve been able to move beyond most of that. As long as the lending industry stays as it is, I don’t foresee anything derailing the industry in the near future. I don’t believe a slight interest rate increase would adversely affect the industry, but I do believe low inventory would slow the industry down some.
More boomerang buyers are coming back into the market in 2016: they waited three to five years after a short sale and are coming in at a higher price point than first-time homebuyers. That said, we still have to focus on the first-time buyers – those who are still struggling with high student loans and finding their place in the job market. We need to be vigilant in ensuring that Fannie Mae, Freddie Mac and FHA are around to keep the market viable.
Neena Vlamis: For the economies in Chicago, and Illinois in general there needs to be some serious resolution regarding the government spending and budgets. Simply raising taxes and squeezing out the private sector is not a long term solution. I would say this is the same challenge for the world economy. Governments were never meant to fund a lifestyle for the mass population; rather provide opportunities to exceed. The free markets of the United States were why countless immigrants, including my father from India, came to America, to able to work and pursue their dream and to be free.
Confidence in the Economy
Last year, our panel of managing brokers, agents, lenders, association presidents, and CEOs agreed that good things were on the way in 2015. Carol Prieto said her confidence in the economy had increased since the previous year due to her office’s increase in business from buyers; Jeff Benach’s confidence in the economy remained steady, and he predicted that this year the economy would stay the course with a slow and steady recovery. Rising inventories, a stronger job market and low mortgage rates made Colleen Bara “cautiously optimistic”, while Teresa Ryan saw a “good period for local real estate” on the horizon due to “good balance of seller and buyer demand.” Kathleen Malone welcomed 2015 with open arms, reminding us that “growth is great, but stability is really important,” a message many of this year’s panelists have echoed looking forward to 2016.