Home Buying in Fort Bragg>Question Details

Richard Mill…, Home Buyer in Fort Bragg, CA

Why aren't the homes selling in Fort Bragg?

Asked by Richard Millis, Fort Bragg, CA Mon Dec 27, 2010

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There are many factors that are affecting home sales in our area. The #1 reason right now is that inventory is so low. I believe this is because homeowners are reluctant to sell their property for less than they feel it is worth in this market, and are waiting for prices to go back up. Which they are, so we may see more listings in 2013. Another reason is that our economy here is basically tourist driven, so for the most part, people do not purchase here because there are jobs. They purchase here because it is a wonderful vacation designation. They typically purchase a home in our area as a vacation get away, sometimes with the intention of eventually retiring here. And, of course, even though interest rates are at an all time low, funding is more difficult as the criteria is so rigid for qualifying for a loan.
All that said, homes ARE selling here. The biggest problem that I see is lack of inventory.
0 votes Thank Flag Link Fri Jan 18, 2013
If you are comparing the home sales activities from the late '90's to the 2007, it does seem like we are at a standstill. The number of homes selling in Fort Bragg has really dropped as have their sales prices. In a nutshell, sellers are unwilling to sell for less than they owe. Buyers are having a harder time qualifying for loans. Banks have all but stopped lending money and the two biggest institutions responsible for buying loans originated by banks and loan brokers, Fannie Mae and Freddie Mac, have increasingly more stringent rules for borrowers, loan brokers and sellers to get their homes to qualify. Add to that progressively more jobs are being lost in our already economically challenged rural area and you have a perfect storm where multiple elements have converged to cause the market to tank. Increasingly, REO's (bank-owned properties) are what are selling. Since the banks want them off their books they are selling them at a discount. The downward spiral of value further is exacerbated when sellers want to market their home at fair market value but comparable sales of similar distressed properties drag down their home's value. Don't forget to factor in the seasonal nature of home sales in our tourist-driven area. Despite all the gloom, though, there is one great ray of hope. Homes in our area have not been as affordable as they now are in over ten years. If you can qualify for a loan, rates that have gone lower than five percent make this the best time to be a buyer in as long as anyone can remember.
0 votes Thank Flag Link Mon Dec 27, 2010
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