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I’ve been doing a little reading lately, and a little listening too. There is this guy named Stephan Swanepoel, who is supposed to be the Grand Pooba of real estate forecasting. Most people have never heard of him, which makes him even more mysterious. Like most of the gurus, he never seems to remember when he was wrong, but he is right most of the time. There is another guy named Dan Forsman, who happens to be the CEO of our company, and is also a CPA and pretty shrewd number cruncher. If you pay attention to them you can learn some things. Between the two of them, I’ll try to summarize what will happen during the remainder of 2010. To put you at ease, this is not me actually trying to think. As they say, just sayin’. Mortgage rates will increase the beginning of April because the government will stop subsidizing and buying mortgages at that point, which will erase the false sense of liquidity in the financial market. Last night they announced a quarter point increase in the overnight rate, which signals that will probably happen. The prediction is that rates will go up 40% before year end, which would put them at 7% compared to something less than 5% currently. April 30 will be a pivotal date because of the expiration of the income tax credit for buying a home. If a home is not under contract by then and closed by the end of June, the tax credit will go away and there is no indication of any intent to extend it, even by the original sponsors. The FHA Seller Contributions will be cut in half, and the Mortgage Insurance Premium will soon be increased to 2.25% up front. There are essentially no new homes being built, so as people continue to move to metro Atlanta, the supply of homes for sale will decrease. At first the value of homes will slip sideways, so to speak, and then they will start to climb significantly. The climb will stop when a sufficient number of new homes are being built to offset demand, which will happen when lenders are confident enough to start providing money for new home development again, which will be awhile. The following chart represents what it will cost home buyers who miss out on the current window of opportunity, not to mention the future value they will lose when home prices increase. The Cost of Waiting$200,000 home with 5% Down Payment 

 On top of these costs, with an interest increase from 5% to 7% on the same home and assuming a down payment of $6,000 the payments increase by $246 per month. That by itself is almost $3,000 per year for every year you stay in the home! If you snooze, you lose. Ron Barnes can be reached at 678-520-6648 or rbarnes@prudentialgeorgia.com. Prudential Georgia Realty is anindependently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential FinancialCompany.Equal Housing Opportunity. Statistics are taken from Trendgraphics.