This post first appeared in: Cirios Trends – Special Edition: 2010 Real Estate Roundup

In February of this year, we wrote:

“while many risks still remain for the housing market, we believe the time for being pessimistic about real estate is finished. That’s not to say there won’t be more price declines, more foreclosures, more defaults – to be sure, there will be more of all of those things; housing is far from out of the woods. But we have reached a point where Price Discovery is far enough along in certain markets that it’s time to start looking for opportunities, rather than sitting on the sidelines.”

Since that time, the homebuyer tax credit expired and in many markets, demand all but disappeared; interest rates have risen materially from historic lows and mortgage guidelines continue to tighten; Greece effectively went bankrupt; Ireland effectively went bankrupt; we experienced the worst off shore oil spill in United States history; a “Flash Crash” in the stock market erased $1 trillion in value in a matter of minutes and still remains largely a mystery; unemployment remains stubbornly high; jobs remain stubbornly scarce and shadow housing inventory remains at historic highs … to name but a few of the headwinds our economy faced this year.

And despite all this, we are sticking with our statement from February, licking our chops at the opportunities that ongoing turbulence in the housing market is busy creating. To be sure, not every listed property is a deal and there are myriad pitfalls if a buyer doesn’t exercise caution, but we are still of the belief that now is a time to be opportunistic, rather than pessimistic. Certain segments of the housing market are extremely compelling at today’s prices, as fundamental changes within communities are ongoing.

The key of course, is knowing what those segments are and what to do about it.

In this month’s Cirios Trends, we examine the key events of 2010 and how they shaped the housing market. We saw ups, downs and just about everything in between. But through it all, buyers who bought in the right markets did well, while others are stuck holding depreciating inventory because they didn’t understand the market.

Individual homebuyers, while not always as economically motivated as investors, have experienced a mixed bag of opportunities and frustrations. Sellers in certain areas are reticent to accept realistic pricing, and a slew of properties have languished, unsold on the market. Patience and opportunism remain central to finding a great home at a great price.

So, sit back and enjoy a turbulent journey through 2010 as we eagerly await what 2011 has in store for real estate markets here in Bay Area and beyond.