I have put off my 2009 prediction as long as I can; one reader just called me on my delay. It's very hard to have confidence in anything in an economy that most of us have never experienced. People are buying homes – lots of homes – and there are many more foreclosures to come. But for those of you who are looking to pick up an investment or vacation home – get ready! The opportunity has never been greater.

Sales have slowed a bit, which can be expected during the winter. However, sales are still double what they were this time last year. I expect to see sales begin to rise again by the end of February. Indeed, call and email volume is already picking up rapidly. This is often a good sign that sales will rise soon, though all bets are off in this economy.

Last year I really went out on a limb when I predicted we would see the bottom of the market in terms of sales by late February. We did; sales rose rapidly after that. Sales are still strong, and if they only remain constant that’s a good thing. But I predict an upswing in sales as more investors jump in, lured by prices that are often below replacement cost.

In January of 2008, there were 3,779 Notices of Trustee Sale filed in Clark County. In December, there were 7699. For the first half of this month, there were more than 4500 Notices filed. It’s impossible to extrapolate this into an accurate foreclosure estimate; there are now so many factors, such as loan modifications, that could render such an estimate inaccurate. But it isn’t difficult to predict that more foreclosures are coming.

Banks are pricing homes to sell in 2 to 3 months, and continue to drop the price on a foreclosure until the price appears irresistible and it gets snatched up. As more foreclosures hit the market, we should expect to see prices drop further. On the other hand, increased demand in the spring and summer will probably keep prices from dropping as rapidly as they would if no one was buying.

Prices are still falling, and I predict that they will continue to fall for at least 90 to 120 days. Unfortunately, you won’t know when the market has reached bottom until prices are already rising. Investors picking up properties right now are aware that prices will probably drop further; they just aren’t very concerned when they are buying houses for less than one can build them. Better to lose a little “paper” value and regain it when prices rise than to pay too much for a home when prices rise.

For those of you who have been holding back, I suggest you get ready to buy. The competition will become fierce in the spring and probably throughout the summer. At that time you’ll not only be competing with investors, but you will be competing with anyone looking for a personal residence as these buyers tend to jump into the market beginning in April.

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