The Real Story…
News and commentary about the real estate market and related topics.
Dave Parrish, ABR®, CRSA, CSP, GRI, ePRO®,REALTOR ®, RE/MAX MarketPlace
The opinions expressed here are my own and don’t necessarily represent those of RE/MAX International.
Coming Winners & Losers …
As mentioned here last week… Changes are coming that will impact the housing market. One thing is certain now as always and in any market there will be Winners and Losers with every change in any market.
There have been several positive changes in the market of late… Inventory levels are at a three-year low, demand has started to increase based on the extremely slow last six months of 2010, and price declines have moderated. All good stuff if you’re a seller!
Now don’t get me wrong this is still very much a buyers’ market. Prices are still declining. Inventory is still high (just not as high as it was) meaning there is a lot to select from, and interest rates while not as low as they were are still great!
With the predicted changes:
- Flood of new foreclosures hitting the market in the next 60-90 days
- Interest rates trending higher
- Higher Mortgage Insurance rates along with tiered pricing for credit scores below 740
- Threat of higher down payment requirements for both FHA and Conventional loans
- Application of new Census data reducing areas eligible for USDA Financing
- Likely budget restrictions/reductions limiting funds available for USDA Financing and Bond Money.
- Threat of shutting down Fannie Mae and Freddie Mac will tighten the availability of funds for mortgages, despite claims that the private sector can fill the gap, will further raise rates and underwriting standards in addition to reducing the overall liquidity of the secondary market.
So the new winners are… (Drum roll)… Envelopes please…
- Miss congeniality… Sellers offering Owner Financing.
- Alternate/Runner-up… Any body buying with cash
- Winner… Investors… Especially, Investors buying with cash.
Of course you could out-smart the judges by acting now Mr. Seller by pricing you home so that it sells at today’s prices (rather than the smaller prices ahead) to people who will be forced out of the market… your market… before the coming changes impact the market.
Or Ms Buyer, you can wear the crown of homeowner by taking advantage of the highest home affordability that we’re likely to see for the next several years by acting before all these changes take place… changes that will make the effective price (monthly payments) of the home higher.
May the market be with you.
