Over the last decade or so, money available for mortgage loans became easier and easier to come by. The result was the advent of many exotic and high-risk mortgage programs.
Many homeowners purchased much more property than they could afford which led to the current real estate market meltdown. Some of the issues that have resulted in falling prices and tightening credit are outlined below:
·
·
·
o In 2004, 36 percent of all homes sold were investment or second homes.
o In 2005, vacation and investment home sales accounted for almost four out of every 10 residential sales. Investment homes accounted for 27.7 percent of all purchases and vacation homes were 12.2 percent of all sales.
o
·
·
·
·
·
· In many areas distressed homeowners are either selling short or have already gone through the foreclosure process and these bank or investor-owned listings are on the market, further depressing property values.
Where Do We Go From Here?
The question everyone is asking today is, “What happens now?” While some adjustments may be made to this market collapse through government intervention, the reality is that only time can heal this market.
This crisis, like many others in US and world economic history, will simply have to play itself out. When the excess housing inventory is depleted and consumer confidence in the real estate market returns, demand for residential homes will increase and prices will begin to rise again.
Call our 24 hour info line for FREE recorded information 1-800-239-2513 ext. 2044 or visit our website http://www.johncjones.com
http://www.thehomesaverguys.com