I want to begin by wishing you and your family a very Happy and Healthy New Year and I hope 2008 is prosperous for you. I wanted to take a moment to begin conversation where I left off by answering the question whether or not it’s a good time to purchase Real Estate.

I believe that I mentioned to you how important it would be to follow consumer spending through the ’07 holiday season. Now that the figures are out, it appears that growth was in the neighborhood of 2.2%, the weakest growth since 2002. Since then, consumer spending appeared to be thriving and provided fuel for the economy. We are hearing some gloomy things going on in the world with fuel prices expected to reach $3.50 per gallon yet the Government still feels obligated to perhaps lower short-term interest rates to soften the “blow” to the economy despite inflation concerns. In New Jersey, I recently read an article about significant toll increases for NJ commuters and combined with resign fuel prices, this will have a direct effect on disposable income for NJ residents. I hope these are not signs of tough times as we move forward through 2008.

The Residential market seems to be experiencing some positive signs with respect to mortgage rates and this is fueling the refinancing marketplace due to favorable terms that I thought were gone. That being said, it’s a good time to be a buyer for residential real estate- you have more choices today due to increased supply that is taking much longer for the marketplace to absorb. And, of course, low interest rates are quite attractive for the borrower. I believe it will be good for the remainder of 2008 to acquire residential real estate.

As for Commercial Real Estate, I continue to hope for a break in the marketplace for Buyers for several reasons. One reason is that I have many clients that want to pursue the purchase of their own facility; however, it is still very difficult to identify and secure buildings simply because inventory levels are low and Sellers still believe their properties have significant values even though in some instances, they are unrealistic with their expectations. And coupled with the mortgage debacle, I wonder if lenders really do tighten up their lending criteria. If the lenders become more responsible, I believe Sellers are going to have to face reality if they want to move forward with disposing their real estate assets.

My personal goals involve acquiring real estate assets for investment purposes and I hope when the time comes, you too, have saved up some money to park in what I believe will be a worthwhile investment. To those of you who need to acquire commercial space to run your business, understand that patience is a virtue and eventually, the time will be right for moving forward with this type of venture. It may seem like buying today is the best choice, but are you really purchasing for the right reasons. This will be the topic I will explore in next month’s issue of Real Estate “Talk” with Darren M. Lizzack, MSRE.