Appraisal Exec Coester: Housing Market Is ‘Going to Get Significantly Better’

Tuesday, 26 Mar 2013 08:52 AM

By Kathleen Walter and Dan Weil

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Brian Coester, CEO of appraisal company Coester VMS, believes in the housing market.

“The housing market’s actually doing about as well as it can right now,” he told Newsmax TV in an exclusive interview. “And it’s going to get significantly better.”

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The S&P/Case-Shiller index of home prices soared 6.8 percent in December from a year earlier, the biggest increase in almost 6 ½ years.

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“If you look at 2008 through 2012, it’s really been bad,” he said. “2013 is set up to be a really great year, and that should continue to 2014 and 2015 with a huge built-up demand for purchases.”

Coester takes issue with Yale housing expert Robert Shiller, who says no housing boom is coming anytime soon. Shiller isn’t taking into account psychological factors, Coester explains.

“You really have a lot of people who still want to buy a home,” he said. “You still have a lot of people who do have money who want to get into the market, but they’ve been waiting on the sidelines.”

Over the past three years, a lot of people have been renting their homes, wading through the storm before they buy.

“For a first-time homebuyer, it’s very attractive if you can afford the down payment, if you can service the debt, if you’ve got readily available financing, if you’re qualified and the prices are low. So it’s going to be a good year.”

Student loans are weighing on the housing market, Coester said. About one-third of the almost $1 trillion in outstanding student debt is delinquent.

“If you look at the type of student that would incur a lot of debt, typically, they’re well-educated, they’re going to be employed well and they’d be the optimal person to go out and buy a first-time home,” he said.

But their debt burdens are keeping them out of the home market.

“They’re servicing that debt. Maybe even they’re delinquent on that debt, so it’s affecting their credit scores,” Coester said. “They really can’t go out and buy that starter home that they may end up renting. That has really impeded the markets.”

It creates difficulties throughout the housing chain, because without young people to buy their first homes, the people in them can’t move to second homes.

“This will be a factor as long as student housing and student loans are a factor,” he said. “With the cost of college and the cost of living expenses increasing dramatically, this is not just going to go away.”

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The way to fix the problem is to fix the economy and the job market, which could take five to 10 years, Coester said.


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