Posted by: Christina Dove
According to a study done by PriceWaterHouseCoopers, U.S. commercial property prices are likely to hit bottom next year after falling more than 40 percent from their 2007 peaks. This does not have a very good outlook for 2010 home buyers, who are going to find it very difficult to get a loan or any type of credit from banks. In addition, this is going to put a huge strain on those who are struggling to maintain ownership of their home and are falling behind on payments.
The housing boom of 2006-2007 is to blame for this housing market catastrophe. Too many people were getting loans that they were not able to afford and living in houses that were way above their means. Just because the bank allowed them to get a loan for that much, does not mean it was the most financially wise thing to do. Now these people are paying the price as the value of their homes is decreasing as we speak. People should have known that is was not wise to be paying for a mortgage that was worth well above what their house was worth.
The only good thing about this housing crisis is that those with the cash are able to buy some great properties at an all-time low price. Some investors are taking advantage of those who have had to foreclose their homes and those homes that have been repossessed by the bank and resold. However, this is not the case for many people who are strapped for extra cash in this economic crisis and are finding it hard to even afford the property that they are already living in. The housing market will always be going through ups and downs, but it seems that 2010 will still be a down year for the housing market and people are going to have a lot of trouble selling their homes for what they paid for them.
Sources:
http://www.bloomberg.com/apps/news?pid=20601103&sid=aHljg1MMC.MU
http://moneycentral.msn.com/content/Banking/Homebuyingguide/P37627.asp
http://finance.yahoo.com/real-estate/article/104278/Best-and-Worst-Places-to-Buy-a-House
I guess we have to wait for the economy to get better to buy a home. Banks are now relectuant to lend to others.
ReplyDeleteScarlett Lu
of course those who can qualify will get great rates and low priced homes... so isnt 2010 a great time to buy?
ReplyDeleteWITH INTEREST RATES AT AN INCREDIBLE LOW AND PRICES TOO... THEN YES 2010 IS A FANTASTIC YEAR TO BUY !!! So many people couldn't buy BEFORE the last climb in the market and those people are buying up property now !! Look for some incredible deals in Myrtle Beach, SC - I just recently purchased a condo from Pam Guthrie there who has been in real estate OVER 25 years and she found me a deal that was $200,000 CHEAPER than the last time it sold just 2 years ago !!! Be prepared for MULTIPLE offers though, and CASH TALKS with the bank foreclosures if you want to REALLY get a deal without all the red tape from the mortgage companies !!
ReplyDeleteKeep in mind, the inflation bubble is about to burst in the next 12-36 months. If you finance go for a 30 yr fixed and amortize it down to 22 or so just by making one or two extra payments a year toward the principle. This is better than going with a 15 yr at a similar rate with higher closing because when times are tough you control the payments to amorize it as slow or fast as you wish. The more you put towards principle the less overall interest you pay over the term. I can get rates around 5% right now with no points.
ReplyDeleteFurther info adamc@pierpointmortgage.com
Adam-
Mortgage Banker
Pierpoint Mortgage
njk
ReplyDeleteWith this global crisis many people have refrained from buying a house with their savings or borrow money through any bank reject your application, also because the interests of the bank can get to very high!
ReplyDeleteI believe that this year is the perfect time to buy. I also bought a property in Pennsylvania. The loan heads gave me a very good deal and made me to review the aspects of mortgage. Pittsburgh PA is a good place for my start-up steel company and never doubted the low-cost price and good-dealt mortgage. Pittsburgh inner financing laws even have me in security and it smoothly means that I am in good path and condition.
ReplyDeleteHello, I do not agree with the previous commentator - not so simple
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I just clicked on your name and realized your the proud owner of those housing price graphs and I cannot tell you how many times. I have encouraged people to look at those graphs and they are great.
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