Today, the real estate industry is beginning to show signs of life. It won’t be returning to the craziness of the late 90’s into about 2005 or 2006 probably in our lifetime. The media is attempting to spin data to suggest that the economy as a whole is way better than it is. I believe things are getting a little better, slowly anyway. The question that begs to be answered remains the same…is real estate back? Are we really on the road to a real estate recovery? This is an important question and not to be taken lightly. Think for a moment about how many varied industries are impacted when a home sells… It’s staggering in size and scope. That’s why the government has such a vested interest in propping up the real estate markets nationwide through whatever policy(ies) and initiative they can create.
Let’s look at a few points, shall we… Inventory is low in most markets in the country. Interest rates are at historical lows and not expected to stay that low forever. Loan programs have tightened up making it more difficult to obtain financing. Multiple offers are occurring in many markets. Sellers are unsure if it makes sense to list now. Buyers are hesitant. Lenders want to make loans, but the underwriters are scared to take a chance. High credit scores are absolutely critical. Banks are sitting on a huge inventory of homes that have been purposely held off the market. Buyers expect homes that are way over-the- top and far underpriced; they are looking for the obvious value harder than ever before. A lot of buyers that have great credit don’t have the cash needed for a down payment. There’s a lot of pent up demand for owners to sell and move up by taking advantage of today’s low rates, but are afraid to list their home and have it sit, not sell and miss-out on the one they want. In some markets, the inventory is so low, that escalation clauses are being seen again as is multiple-offers. Poll after poll suggests that young people’s attitudes swing towards renting for a longer period of time. This may be a result of living through the rapid rise in real estate valuations experienced by their parent’s and then the subsequent crash that saw many people lose their homes to foreclosure. People who owned a home before and lost it to foreclosure can’t buy for years and even if they could, many are unwilling to take the risk of losing another home and the damage it can do to their credit.
So… What’s the verdict? Where are we heading? As a real estate agent, how do you prepare? Should you throw in the towel or do you gear up for a ton of sales?
My crystal ball is a cracked as everybodyelse’s. How you can thrive no matter what the economy is doing is the subject of this blog. I hope you enjoy it, find useful and actionable items and ideas you can use and implement in your business and I look forward to your comments. Please Like me, friend me and follow me here so I can notify you when a new article, rant or rave gets posted.
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