Reaction to the economy
So, you sit there and listen to the talking heads proclaim the economy is beginning to show signs of life. The NAR continues to trumpet that home prices are down and interest rates are at historical lows. Oh, and the future looks bleak because interest rates will probably go up, so now is the time to buy.
Pent up demand will create an onslaught of buyers
Well, that's what the brokers are saying. They use logic to point out that people are still getting married, having babies, getting divorced, transferring from out of town, etc. All the reasons people have bought in the past exist today and there must be more people on the fence because the market has been abysmal for several years.
A fairy tale that rings quite true when the experts speak
It is frustrating to many of us. I have friends that are agents in Florida, Arizona, Pennsylvania, Virginia, New Jersey and several other states. They don't seem to be singing the same song. Things are not good. Things are not getting better. The things we see on the inside indicate, they may never get back to anything close to a normal market. You see, we actually deal with the sellers and buyers.
Sellers are devastated. It doesn't matter if they bought the home two years ago or twenty years ago. They have lost equity. It may be real ( if the equity was cashed out ) or it may be perceived ( if they were thinking that they could sell and supplement their retirement ). The can not sell the house for what they want to sell it for. In many cases, they can not sell it for what they own on it. Home prices have plummeted all over the country. In some areas they have rebounded a bit, but in most areas it will take ten years for prices to recover.They are devastated.
Buyers are terrified. It doesn't matter if this is their first purchase or if they are moving up or if they are just investing. How in the world can you buy a home if you are not sure it will hold it's value. How in the world can you buy a home if there is a chance that the bank failed to foreclose properly and you might lose the home you bought. The fact that you will be made whole has little effect on the fear of needing to find a new home again. Oh, and how do you buy a home if your job is in jeopardy or if you lost your job. It really doesn't make a bit of difference where interest rates are.
0% or 5% or 10% or more doesn't matter if you don't have a reliable income!
The economy is rotten. Black Friday sales are not an indicator of our true economy. Hell, most government reports exclude the cost of living from the cost of living indexes. Politicians appoint bureaucrats that hire people to create information. It is always tainted. Most of the information, as bleak as it seems, is offered in the best light.
If you happen to be at a holiday party, and find yourself chatting with a real estate agent, don't ask...and he won't tell. The market is the market. It is no better than any other segment of the economy. Sure, if you have a friend or relative that is looking and is in position to buy, refer them. If not, talk about the weather, sports or something else.
Truth be told, those of us surviving are becoming a smaller group everyday. Those of us that wait for that next opportunity are very aware of the large volume of bank owned property waiting to put for sale. We are very aware of the fact that the FHA is slowly eliminating condominiums from the mix. We know that big banks do not give a whit for the FHA criteria and would rather use the 2011 version of redlining ( something now labeled - over lay ).
If you are watching and waiting, that is ok by me. If you would like to be kept abreast of what is happening, subscribe to the blog or send me a note and I will add you to my email list for newsletters. If you are packing up and moving to South America or beyond....be careful, it is a world economy.
On second thought, unless you work as a Realtor, I don't think you ever hear what I hear. And boys and girls, that is not really a bad thing. We all should be listening to the sound of our own drum.