Nashville, Tenn. -- A few months ago, John Burns described himself as a raging optimist. Today he's just an optimist.
That was one of the observations from the real estate consultant's presentation at the ProDealer Industry Summit. The fundamentals of the housing recover are solid, he said. But in the sales office, sales and bargains and price drops surged in September. A survey showed 10% of builders surveyed dropped prices, from zero in the previous month.
So much of the real estate market, of course, is regional. And the top three regions showing real estate strength are northern Florida, the Southwest and Southern California.
"I think the future for this industry looks bright," Burns said. The industry has moved ahead of retail distress and is looking ahead to normal levels of resale activity as construction increases steadily.
"Demand, supply and affordability fundamentals are solid, but trends are worth monitoring carefully," he said.
Burns attacked a couple of ideas -- especially the idea that consumers are moving back to the cities, a myth he described as extremely "overhyped." The growth of the urban core, he estimated, as a mere 5% of overall housing growth. "The big growth is still in the suburbs."
Burns also suggested that people should ignore reports that smaller houses are gaining momentum. The reality is consumers want bigger houses, he said, and builders are naturally incentivized to build big houses.
The ProDealer Industry Summit, sponsored jointly by HCN and the National Lumber and Building Material Dealers Association, concludes Oct. 25.