My sellers never want to break even and my buyers never call the downpayment cushion. If the prices are falling most of the buyers will stay on the side lines till they think they have found the bottom. Look at the stock market there aren't many buyers around. It has been tough to match up sellers with willing buyers.

Ilyce,

That is an interesting take on home ownership. The nmarket has traditionally always been a tool for people to make money at the closing table. The idea of looking at $30,000 as an investment  to lose is  concept I can put my arms around. Would you please go into this a little more.

Hi Randy,

I think a good way to put this into perspective is this: no investment is guaranteed, but it is still made in the hopes of some future return. In the example above, the homeowner lost his $30k at the time of sale. Had he not "invested" that money in the home, he could have 1) taken a larger mortgage with relatively small monthly payments (creative financing) and 2) taken that $30k and invested it into some liquid vehicle that would make him more money (with a rate of compounded interest greater than the mortgage rate) in his overall financial picture over time. In addition, the borrower would experience a greater tax benefit from carrying a larger mortgage balance. Combined, these items would be the true "cushion" for unplanned emergencies, home improvements, or having a strategy for improving personal cash flow. When the money is used to simply reduce the term or amount of the mortgage, there is no safety net for any issues that may arise in the future.

I hope that helps. Did I answer your question?