Real estate is a hot topic right now and I have run into a lot of friends over the last several weeks that have asked some very common questions. I (like other real estate professionals) have some opinions about the housing market. You may not agree with me but here they are:
Q: What will the 2011 housing market look like?
A: This is a tough one. I wish I had a crystal ball. I honestly think it’s going to be a very tough market in 2011. Until we can get Americans back to work and unemployment stops rising I just don’t see the housing market turning around. Consumers are so uncertain about their income and they are simply unwilling to make a large purchase like a car or a home. At some point they will decide the worst is behind us and decide to start buying again but I am not sure when that will be.
Q: When will we hit the bottom of the market?
A: I think we are getting close but we will never actually know when we have hit bottom until it is behind us. There are still a large number of homes in the foreclosure process that have yet to hit the market. Obviously once the supply and demand ratio starts level out we will hit bottom.
Q: I owe more than my home is worth, what should I do?
A: First, contact an expert in your area. A Realtor is a good person to start with. There are several options; you can hang on until things come back, short sale your home, negotiate a loan modification with your lender or walk away all together and foreclose on your home. Many of these come with severe consequences and will affect your ability to borrow money in the future. In some cases though, walking away from a substantial loss can be the best option.
Q: Is now a good time to buy or should I rent?
A: Buy, baby, buy! Homes are on sale and you can borrow money for less than 4%. Home ownership in my opinion will always be one of the greatest assets that will help build wealth over the long term. In fact, even with the current mess we are in – homes have increased in value 58% per square foot nationally over the last ten years. Buy low (now) – sell high!
If you have questions about your home or the real estate market feel free to contact me.
