Since the beginning of January 2009 I have had increasing activity from potential buyers in the Gainesville, Florida area. There has been more interest in all kinds of real estate properties. I have had calls from local people, from other cities and states, and from several Asian countries.
I have had more requests to show single-family homes, vacant land, and industrial properties. It appears to be an across the board increase in prospects.
However, this increased potential buyer activity, although very welcome, has not resulted in an increase in closings. Of course, closings are what really count. If you look at it as a "numbers game" as many people do, then eventually the additional activity should result in additional closings. But I look at real estate as a "relationships game" where the additional interaction is what eventually brings addtional closings.
I have determined that there are 2 reasons why the increased activity hasn't resulted in more closings. Firstly, I have had numerous buyers and sellers who would not agree to a mutually satisfactory price. The buyers are seeking super low bargain prices and the sellers believe the market will soon rebound bigtime. Sooner or later both sides will have to face reality and meet in the middle, but that hasn't happened yet.
Secondly, buyers who in the recent past would have easily qualified for a mortgage loan are now failing to meet the latest standards. Unless all three legs of the lending stool are superior - very high credit score, very large down payment, and sufficiently high income, the loan won't be approved. Buyers almost have to prove they don't need the loan in order to get it.
I have visited many banks, large and small, recently during working hours where most of the loan officers were sitting around in one office with nothing to do but shoot the breeze. So, if the banks won't make the loans, I'm convinced that there are others who will.
I have resorted to trying to connect potential buyers with private individuals who have money they need to put to work. With time deposits paying almost nothing in interest, I am seeking people who might want a 6 or 7 percent return on investment. I am convinced that there are private lenders who will take a risk lending to buyers who will put a 25% - 45% down payment on a home with a 10 - 15 year loan.
If you fit into this category, you have $100,000 to $200,000 that is earning almost nothing in a Certificate of Deposit, you can afford to tie it up for 10 -15 years at 6% - 7%, don't mind the risk of possibly having to foreclose on a home (there's always a risk no matter how well the borrower is screened), then let's talk.
Mark Cohen, Broker