Cheap Homes for Sale
The price tag for homes for sale is
believed to have drop another 15-20% in most markets. Is now
the right time for home
ownership?
As you may have heard, real estate sales are picking up. The
main reason people are finally coming out to buy these homes
for sale is that new niches are opening up to further entice
buyers. There is a huge stock to choose from, and the
foreclosure and short sale prices are right. In the past, real
estate agents tried to entice buyers with perks or more lenient
lending standards. However, these tactics simply don't work
given the current economic downturn. Here we'll talk about some
of these new niche markets and how they're changing the realty
landscape.
One new niche is the foreclosure market. In some places, like
Jacksonville, Florida, one-quarter of the houses for sale are
foreclosures. The Northeast Florida MLS has more than 14,886
listings that are in foreclosure or short sale status. In this
buyer's market, "It's basically a clearance sale," says Rob
Friedman, the chairman of the Real Estate Disposition
Corporation (REDC). Last year his company sold more than 30,000
foreclosures on the auction block. Most of the house sales are
by first-time buyers or those who've saved all their pennies
and are now snatching up homes at half or quarter the
price.
The price tag for homes for sale is believed to have drop
another 15-20% in most markets. However, short sales from
distressed homeowners undergoing foreclosure are already
selling at prices this low. In a short sale, the homeowner gets
permission from their lender to sell a house for less than the
value of the mortgage and closing costs and the lender agrees
to consider the debt forgiven. This mutual compromise avoids
leaving the homeowner saddled with a foreclosure on his/her
credit report and avoids leaving the lender stuck with more
inventory. "There are some opportunities, especially if you're
willing to live with the property for 10 years or so," said
Rodney Loesch, a certified financial planner based out of
Columbia, Missouri.
The overall advice about snapping up
discounted homes for sale right now is to do it if you have the
money and are looking for a primary residence. However, the
foreclosure feeding frenzy has attracted some buyers and
foreign investors who are grabbing homes in bulk. Detroit
realtor Mike Shannon mentioned picking up ten new clients from
out-of-state or out-of-country looking for "50,100, 1,000
homes." Have we learned nothing from the
past?
The problem of house flipping for a profit and hitting up
realtors for "secure" investments has been part of the housing
crisis problem that drove up prices and demand to intolerable
levels. Until people start operating based on need, rather than
want, we may be doomed to make the same mistakes time and time
again.
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