I hope you are having a good week. Here is some information I thought you would find helpful in getting your buyers off the fence.
Buying a home may never get any cheaper than this. Several housing experts are predicting that this year will be the last chance for bargain hunters to cash in on the best deals of the weak housing market. With home prices down 34% nationally since 2006 and home loan rates at historic lows, homes have never been more affordable -- but it won't stay this way for much longer. Economist expect home prices to flatten out by the third quarter and start climbing again by next year. The decline in foreclosures and continued job growth is partially responsible. As buyers get their finances in order and improve their credit lines they will have better access to more home loans.
Some economists, like Trulia's Jed Kolko, expect home prices to pick up even more quickly. Trulia's data shows that the national average for asking prices already increased 1.4% in the first quarter of 2012, compared with the last three months of 2011. One major factor that will drive the trend is the cooling of the foreclosure crisis. Stan Humphries, chief economist for Zillow, said that the percentage of residential loans 90 days or more late, a good predictor of future foreclosures, is "falling fast." That percentage dropped 15% year-over-year to 3.1% through the end of 2011, according to the Mortgage Bankers Association. And the decline is accelerating: More than 70% of the decline came in the last three months of the year.
Before things slow down, however, buyers should brace themselves for a temporary spike in the number of foreclosures as banks start expediting the processing of hundreds of thousands foreclosures that were stuck in the system following the robo-signing scandal. That backlog should move more quickly now that new guidelines for processing foreclosures have been outlined in the $26 billion foreclosure settlement. Many of the bank-owned properties currently coming out of the foreclosure pipeline are being snapped up by investors who are fixing them up and renting them out -- often to those who were displaced by the foreclosure of their own home. That has helped to lift prices on foreclosed properties, according to Alex Villacorte, the director of analytics for Clear Capital, which specializes in housing market valuations. Source: CNN/Money
Bargain home prices have jump-started sales on second homes, but more purchasers are opting to buy properties much closer to their primary residence. In the past, second-home buyers tended to buy properties out-of-state or were lured to vacation homes near far-flung resorts and tourist destinations. But second-home purchases these days seem to be more restrained, as more purchasers opt for vacation spots that are within a relatively short drive of where they live. Source: The Wall Street Journal
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