Our market is starting to feel the effects of the national b-paper collapse. I am still seeing alot of potential buyers but many of them have houses to sell first and many of these are out of state. We are still having people relocate in here and several of them are buyers. Up until 6 months ago, it was hard to find available homes in the price range of $100,000-$150,000. Now, that price range has many listed homes available.
Many of the newer companies that had taken advantage of the b-paper feeding frenzy are really feeling the effects of the b-paper collapse. We are not seeing many sales now by those companies and agents that were doing the sub prime deals. I expect many of these agents to retire their license before years end.
Those homes sold by these b-paper realtors are starting to show up as foreclosures(many getting listed every week). Many of these were sold and mortgage companies allowed the borrower to borrow 100% and lender allowed purchaser's closing costs to be paid by seller(price just bumped up). For the last 4-5 months that lending faucet seems to be cut off but the homes going into foreclosure should continue to climb until that initial 2 years fixed interest rate period has passed for all of these loans. With that said I expect the foreclosures to peak here in Dyersburg withing the next 6-12 months and then start to decline. The price range most affected by this ARM (adjustable rate mortgage) collapse in Dyersburg is $50,000-$80,000.
There will be lots of money lost by these lenders. We see several national financial companies writing off millions of dollars every month. These big companies own the b-paper companies or subsidiaries that made these loans. These lenders(and realtors) saw an opportunity to make some quick easy money regardless if it was best for the client.
In the long run, this upheaval will be good for the real estate and lending industry and good for Dyersburg,Tennessee. Realtors here will just have to do business the old fashioned way(hard work).
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