Personally, I have a great feeling about 2011.  After all, 11 is lucky number!

 

But in the spirit of making predictions, I'd like to remind everyone of the parable of the Zen Master and the boy.  The parable was at the end of Charlie Wilson's War.  I like it because it teaches us humility in our ability to make predictions.  It's mostly delivered by Phillip Seymour Hoffman's character, Gust.

 

The Parable of the Zen Master and the Boy

 

Zen Masters Like Candles

There’s a little boy. Now on his 14th birthday he gets a horse, and everybody in the village says “How wonderful the boy got a horse,” and the Zen master says “We’ll see.”

Two years later the boy falls off the horse, breaks his leg, and everybody in the village says “How terrible,” and the Zen master says “We’ll see.”

Then a war breaks out and all the young men have to go off and fight, except the boy can’t cause his leg’s all messed up, and everybody in the village says “How wonderful" and the Zen master says “We’ll see.”

The story, of course, shows that determining whether or not something is TRULY a good thing or a bad thing is based on our ability to predict the future.  And the parable also demonstrates how terrible we usually are at predicting the future!  But there's no point in not trying.  

 

I hope to update this with baseline status later in the year so that I can check in on how I'm doing in the prediction biz.

 

 

  1. Housing transaction volume will be up, slightly, in Massachusetts.  
  2. Prices will be up, 2-4%
  3. The spring and the fall markets will be more even this year, resulting in disappointing stats in the first half, but encouraging ones in the second half.

Other notes (added late January, 2011):

 

I have started to track a measure for looking at foreclosed properties in the towns covered on the blog.  The main reason for this is that there's a huge debate going on "out there" as to the amount of "shadow inventory" and how when the "shadow inventory" hits the market we're all going to see property values dip (depending on who you ask) another 5-20%.  So that depends on the following:  That most (or a lot) of the shadow inventory reaches the market in 2011, AND that the inventory is priced (as is typical 5% below market, AND that it's enough inventory to saturate the market - create more sellers than buyers.  Oh, AND the banks don't start agreeing to more short-sales instead of foreclosures.

 

If it works out that way, the results will be far different than my predictions here, hence, my reason for tracking the inventory.  I can tell you this though:  right now, there's not enough foreclosure inventory to push prices downs.  It's only about 5% in my area, and while by historical standards that's a lot, most towns are short on homes to sell, and have too many buyers, so it's going to take more than that.  Stay posted, we'll see how it shakes out.

 

Do Good Things Today!

 

 Matt Heisler