It wasn’t a coincidence that the real estate bubble burst and the downturn in the economy started at the same time. There’s certainly a correlation with the economical and housing recovery currently taking place. A healthy economy is dependent on a vibrant upswing in housing. More buyers are taking full advantage of the opportunities that exist, lower mortgage rates and a decrease in home prices. Sellers are benefiting from less competition from other sellers and the downward trend of the bank owned properties. Real Estate led us into the abyss and it will lead us out of the economical monstrosity of the last several years. Let’s look at a few points that can expedite our recovery.
Jobs, Jobs, Jobs- The unemployment rate is too high and a drop would put more prospective home buyers in a position to buy a home. In many communities there are numerous bids from buyers on any given property. More well-paying jobs would allow more buyers to hit the market and accelerate home prices.
Mortgage Rates- Interest rates have propped up the housing market over the last year. The historical low rates have been the saving grace for first time buyers and should be a spring-board to a full-blown recovery. Until housing can walk on its own two feet, rates should be systematically kept low.
Housing Inventory- Next to mortgage rates, the lack of inventory has helped escalate the frenzy this year. Banks are now offering loan modifications that have decreased the number of foreclosures that were so prevalent in prior years. Many owners have held off selling their home until the market completely turns. Low supply and high demand should be with us for the forseeable future.
Attainable Loans- We obviously do not want lenders blindly offering loans that created the housing bust, but there should be some sensibility when it comes to obtaining a home loan. Loans should be streamlined and less restrictive for buyers with good credit scores and a decent down payment. The overbearing conditions should seize. Rejecting good loans is not a good business practice.
This coming year will offer more of the same and be the next leg in our recovery. Real estate is getting it’s swagger back. Please visit my website at www.JohnnyBrooksHomes.com for helpful tips on buying or selling a home, scan my informative blogs and easy access to view local area homes for sale in Davis, California and the surrounding communities.