What an interesting economic time to be living in! With the highest unemployment and forclosure rates in decades, lenders are holding on to every last cent. The demand for real estate has been reduced to a fraction of what it was just 36 months ago. Add in that interest rates are sub 5% for qualified borrowers, the basic "buy low, sell high" philosophy encourages us to find a realtor and acquire one of the milions of undervalued properties that exist in every neighborhood. The only problem is that not everyone is able to make a transaction.
"Would be" homebuyers fall into one of many categories that disqualify them from participating in the prime-time of buying real estate. One of which, is simply the inability to get a loan. More than 1 in 10 people are without work, and in the last two years, the numbers have not shown signs of improvement. Without adequate and stable taxable income people in this position instantly raise a red flag to any lender. Another problem people face is that homeowners have homes that they have over leveraged or the properties are simply worth less than the purchase price. Property owners just can not afford to get out of the home that they currently have. Either they do not have enough equity or cash reserves to get out. No matter what the reason the supply far exceeds the demand.
Those who do not fall into any of these categories should be taking advantage of the discounted home pricing, cheap cost of money and enticing tax incentives. It is a decision that qualified buyers will only regret if they hesitate to act. History has shown that it is just a matter of time for home prices and interest rates to increase and for inflation to occur.
By: Michael Wiener, M.S/Realtor
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