Mathews Associates

"Building Lifestyles for Life"


Posted by Dwight Mathews on December 23, 2009

Dear Matt,  You said wait-don’t buy yet but I just read in the paper this morning that home sales went up again.  What should we do now?  Have you changed your mind? -Were you wrong in telling us to wait until next year?

No!  Not at all.  As a matter of fact, the housing market is still weak on several fronts, and if not for government intervention (First time home buyers tax credit), prices would have dropped further this year.  Any price increases you may have seen are superficial at best.  Please let me explain further.

Serious delinquencies among U.S. Prime mortgages – those made to the most credit-worthy borrowers-were seriously delinquent in the third quarter.  That was more than double the year ago quarter and up nearly 20 percent from the 2009 second quarter.  (see my previous post-Looming double bubble).  Combine those facts with over a million Bank owned properties (Shadow Inventory), yet to come on the market and you have a compelling case to be a patient savvy buyer.

In my opinion;  The first quarter of 2010 will be a turning point for the market.  Be advise however, that regulatory changes could come with the approval of pending legislation, affecting everything from down payment requrements, FICO scores, insurance premiums, limits on certain types of buildings, dollar limits on costs that can be paid by seller.  Virtually all of these possible changes are due to the fact that over 28% of all loan modifications are recurring defaults and approximately 24% of all new home purchases made starting in 2008 under the Tax Credit program are already delinquent and in foreclosure.

The bottom line is!  If you have excellent credit, a steady job and a sizable down payment,  you are in control and the banks are lending.  If you don’t meet that criteria,  the opportunity to buy a home is still within reach.  It just takes a little more creativity and determination to make it happen.

For a Private One on One Consultation and a Free Profile valuation please call my office or email me with your request.

“I’m always here to help-Exclusively on your side”

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