If you're banking on any rapid, dazzling changes in the housing market -- a move by the Federal Reserve to push interest rates down or up, or sudden spurts in home sale prices -- forget it.
The watchwords for residential real estate, across the country right now are moderation, cautious optimism and slow, steady recovery.
The Fed has nothing immediate up its sleeve in the way of a monetary crackdown or relaxation, if chairman Paul Volcker is being candid about the board's plans for the coming several months. Volcker says we're going to stay on the same course through 1980, with moderately tight controls on the expansion of credit aimed at getting inflation down below double digits, despite rising unemployment.
A let-up in the Fed's grip on the growth of money would help housing and the mortgage market in the short run by stimulating new and existing home sales and dropping interest rates. But it would probably push prices out of sight as well.
So Volcker's promise of a steady course can be taken as an important sign to consumers that the cost and availability of mortgage credit won't jump around in the coming months as it did earlier in the year.
The retailers of mortgage money -- the nation's thrift institutins and banks -- offer similar signs of stability. Mortgage rates in virtually every state are now in the 11 1/2 to 12 1/2 percent range, and holding firm. There's no prospect for rates dropping much below the 11 percent mark -- nor are there prospects for big increases beyond the 12 1/2 percent upper limit.
Savings inflows have been weak at S&Ls nationwide, but demand for those funds in the form of home mortgages has been 20 to 40 percent behind the summer pace of 1979 in most cities, according to surveys by the U.S. League of Savings Associations.
If you're in the market for a new home and it's your first, you can be thankful for one economic fact of life: Prices of homes, high as they may seem, have been rising at a slower rate during the past 12 months than at any time in the past five years.
A 22-city survey by the National Association of Realtors in the last week of July found new and existing home prices in the majority of markets up by 7 to 9 percent over comparable year-ago levels. That's a lot better than things were in 1978 and 1979, when 15 to 25 percent gains were commonly reported around the country.
The 1980 exceptions to the national price gain averages are Phoenix, Las Vegas, south Florida and a few other Sun Belt boom cities, where price increase averages have been 15 percent or higher. Exceptions on the low side are Detroit, Rochester and Buffalo, where recession layoffs have kept prices flat.
Interest rates, while high by historic standards, are in the affordable range again, and aren't far beyond where they were a year ago. Mortgage plans designed for the first-time buyer -- FHA Section 245 loans, as well as privately insured, graduated-payment loans -- are more readily available from lenders than they were last year or the year before.
On the balance, the market for first-time purchasers is favorable for the moment. If you're serious about buying a town house or condominium sometime in the coming year, this could be an opportune time to look hard at what's out there.
Prices definitely aren't going down, barring a national economic cataclysm. (They're probably not going to explode either, as some building industry economists keep warning they will; but they'll at least rise enough to cost you hundreds of dollars every month you wait.)
Sellers face the same set of economic facts from the reverse side of the table: It's still a buyer's market in most parts of the United States, but interest rate drops and moderation in prices are bringing greater numbers of prospective purchasers back to the market.
The 22-city real estate survey found sales up over the two previous months in virtually every region. Some individual real estate firms in Chicago, Denver, California, Philadelphia, Washington and Seattle report increases in volume of home sales beyond even 1979 and 1978 levels -- a sign that the real estate rebound is gaining momentum.
Prospective sellers who have been sitting on the fence -- waiting for lower rates, better economic statistics or political goodies from Washington in an election year -- may find the current period a sensible time to plan their move. As long as they keep their asking prices reasonable, they ought to be able to prepare to sell in the late summer and early autumn months with confidence.
Beyond then, it's anybody's guess.