I had some good friends over for Thanksgiving.  Pretty early in the evening the question came up; "Lee how is the Real Estate Market?"  "People can't get loans? Huh", he stated. This occurs often.  Everyday it is mentioned the "Credit Crunch" we have to loosen up credit.  I hope everyone reads "You Can Qualify For a Mortgage, It's Just Tougher" by Marni Leff Kottle of the S.F. Chronicle
www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/30/RE8014CT0J.DTL .      

I went on to tell my friend that I probably will do more transactions this year than last but the average price is down 20%.  Home sales are up substantially in San Bruno, Daly City, and South San Francisco with some homes receiving multiple offers.  So getting loans is not the biggest problem.  Getting people not to believe the newspaper is the biggest problem.  Yes getting a loan is different than it was 2 years ago as mentioned in the article.  To get a loan today you must prove you could make the loan payments.  A strange concept?  You see history repeats itself; it used to be that way.  A buyer's credit needs to be good but not necessarily excellent. With 20% down you get the very best interest rate.  With 10% down you could buy a home and get a pretty good interest rate.  You could even buy a home with 3.5% down using a FHA program.  With the 3.5% down FHA Loan a premium interest rate is charged but it allows a buyer to take advantage of the best home buying opportunity in years. 

 My friend lives in Hillsborough and to purchase a home there or in Burlingame, San Mateo, Foster City a super jumbo loan is generally necessary.  He said "oh you can't get those loans".  I replied "no problem just the rate is a little higher."  I knew he purchased his home in the 80's when interest rates were in double digits, so I asked him "what interest rate did you pay when you purchased your home."  He said "14%."   "So what is the problem when you could get a loan for half of what you paid" I asked.  He shrugged his shoulders.  Taking a lesson from retail this is like the Day after Christmas Sale; Half Off.  Interest rates are below average the 25 year average of 8.5% and prices are way below average prices of the last few years. 

 Investors will be required to put 25%-35% down and pay a premium interest rate, but the upside potential is so great it is not stopping them. 

 Many potential buyers are saying they are saving more money for a down payment.  I try to make them aware of the different loan programs out there with the low down payments.  The newspapers have brainwashed many people "You Can Qualify For a Mortgage, It's Just Tougher" by Marni Leff Kottle of the S.F. Chronicle is the first positive article on home loans in a long time.  With today's current low interest rates and the incredible low home prices I will state my mantra;   "It Is Better to Own Real Estate and Wait than Wait to Own Real Estate."
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