Archive for the ‘Opinion’ Category

The beatings will continue until morale improves!

Monday, November 7th, 2011

“The U.S. Federal Reserve is tilting the playing field in favor of those attempting to get mortgages by keeping interest rates ultra-low. The Senate also has voted to tilt the playing field in their favor, by raising the limit of Freddie Mac and Fannie Mae guarantees back to $729,750 – an absurdly high amount for a program that was meant to help the middle class.

However, the banks themselves are being very cautious, restricting lending to those well within traditional parameters of no more than an 80% loan to value ratio and no more than 25% of income consumed by mortgage payments. That helps the rental market, by preventing well-qualified renters from buying homes, but it does nothing for housing market recovery.

Given the restrictions on mortgage availability and the continued overhang of foreclosures and pre-foreclosures . . . the pace of new home sales remains extremely depressed. Further, even when the housing market recovers it will do so first through the absorption of existing inventory, so the demand for new building will remain low.”

Source : moneymorning.com

A Buyers Market … or is it ?

Saturday, January 30th, 2010

The information currently in the news is one of the plight of home Sellers . . . foreclosures, short sales, home loss, great drops in home values and prices . . .  all makes you think this is a Buyers market.

The underlying problem is that there are too many buyers, too many short sales, too many REO/bank-owneds, which actually makes this more of a Sellers market.

Not invaluable in this market,  Buyers have the wrong expectations going into the home buying process.

Buyers need to better understand what is actually happening :

  • they are not going to be able to go into a short sale and offer 30% under asking price, and expect the offer to be accepted¬†
  • a home which has been on the market for 200+ days is not a “desperate” Seller

It is more more likely there have been many buyer offers over that time frame and Lenders are taking their time to pick and choose, often countering with a higher selling price, to see which buyers wish to compete for the house.

The main problem Buyers have right now is that it’s actually more of a Seller’s market in some geographical areas.