You may be noticing signs of a new attitude in Washington. What does this mean for real estate in your area? Things are sure to start changing…but will it be for the better? For those looking to buy or sell a home in Temecula, Hemet, Murrieta, and nationwide, it is likely to be a mixed bag. Here are some key points to keep in mind regarding the future of real estate:
Talk of loan modifications is seldom heard
Most have the attitude that they don’t work, the banks are not responsive and it’s a lost cause. Of course many of the new faces in congress have been saying that the bailouts were a mistake from the beginning but now the attitude is catching on. Billions of dollars in bailouts intended to help the banks produce loan modification options for home owners have simply been wasted money and there are sure to be many discussions about that “wasteful spending” in months and years to come.
The foreclosure moratorium
The moratorium announced by many of the big banks is causing concern in Washington because everyone believes that the economy in general will not pull out of this recession until the defaulted mortgage problem is solved. Economically distressed home owners may find that they can stay in their homes a bit longer but the damage a foreclosure can do their credit is significant.
In response, several service agencies like Ananda Home Sellers have found creative strategies such as Short Sale and Lease Option Matching to resolve property issues without foreclosure. Congress is now focusing their support on these creative approaches. This is the time to explore those options because when the banks get past this snag, they’ll be foreclosing at a faster pace than ever!
Inflation and high interest rates
If you’ve been listening, you’ve heard this. The government has been printing money and injecting it into the economy to try and stimulate growth but inflation always results when an excess of money is present at a time of depressed productivity. Unemployment, the lack of jobs, and production going overseas, are typical signs of depressed productivity and the government can only hold back inflation artificially for so long.
Now, with the new Republican influence in Congress, it is expected that the stimulus activities that have helped keep things in check will be dismantled and inflation will accelerate. The Federal Reserve will have no choice but to start increasing interest rates because that is the only lever they have to keep inflation in check.
We’re in for another dip in home values
Higher interest rates and increased inflation will make it even harder to find buyers and that translates to further drops in prices. Even now, if you’ve been watching the market in Riverside County, homes that are currently priced perfectly to match recent comparative sales would have sold in a matter of weeks just a few months ago.
Now they sit for months on end without any offers.
This is a sure sign that prices will drop again as home sellers compete for the limited buyer pool and this will only get worse as interest and inflation go up. If you are thinking you need to sell your home in the next year, you should do it now and agencies like Ananda Home Sellers who have buyers waiting in line for nice homes are the perfect approach. We have strategies that are proven successful in quickly selling homes for current market value and sometimes even more. For more information, click the “SELL A HOME” link at the top of this page, or go direct to anandahousebuyers.com and request our Free Report.