As a real estate attorney representing clients all over the world in connection with their real estate interests in Texas, I am naturally following the current economic challenges and their impact on Texas real estate very closely. Dr. Mark Dotzour, with the Texas A & M Real Estate Center, was speaking at the national convention for Commercial Real Estate Women (“CREW”) recently in Houston, Texas. According to the Real Estate Center’s chief economist, investors will return when:
1. they can believe bond ratings agencies again;
2. they can believe corporate accounting again;
3. they think the recession is nearing an end;
4. they think house prices are stabilizing nationally;
5. they regain confidence in the value of a contract and that the federal government will not change the terms of mortgages the investors may have invested in;
6. there is clarity regarding what the income tax rates and capital gains taxes will be in 2009 and beyond;
7. they have sorted out the massive government intervention and determined the unintended consequences; and
8. the return on short-term cash gets so low that corporate dividends and corporate bond interest become attractive again.
Dr. Dotzur’s full presentation can be found here. His comments are well worth your time.