Wow! So much to say but first I must say let's not disparrage others. Good news for Trisha is if she has waited she will get what she wants now. Some of those homes priced at $899k are now at $499k! With 2009 ARM (Ajustable Rate Mortgages) ramped up to reset this year things could get worse. This is how I prepare my sellers as well. If you must sell then you must be ahead of the market. If you do not need to sell then do not sell. Buyers, there are still great deals out there but when you buy you must buy well for today's market (don't be afraid to be agressive but note that the best deals immediately have 2-4 offers in place and cash is still king) and be prepared to have your property for 5 years minimum 7+ to be safe. Timing this bottom has never been more difficult as the state of our GLOBAL economy is unprecedented. Just this morning they announced a possible 4% interest rate to buyers and current homeowners. If you ask me current home owners must be able to stay in their homes if they want to stay and can afford to do it. That is where loan modifications can help. However you must fit the four basic criteria: 1) Home must be upside down (owe more than current market value) 2) You must want to stay in your home 3) You must be able to show ability to pay the new mortgage price and 4) you must be able to show a hardship or the inability to pay in the forseable future.
Now with the economic storm we are having many people fall into this. However, not all investors into these mortgage backed securties and such are willing to harbor the loss so currently not many peopel have been helped. Now I'm not saying for or against Bailout but since it happened the Banks have taken theirs and frankly kept it. Now to stave off a wave (Tsunami) of future defaults we have to address the issue at the individual level as well. I don't believe it is just for the "bad" mortgage borrowers but rather the great borrowers who put in some cases their entire lot of equity (hundreds of thousands) only to see it disappear due to the foreclosure wave etc some people are in some cases 64% upside down. The perseption of the consumer is such that even to work out a new payment means being trapped in their home forever. So a principle reduction is necessary here. Why do I say they need help? I don't think the individual will fall for this, just like the banks didn't....they over spent themselves and got in trouble for it...government came in and "bailed" them out and continue to find ways to do so. We need banks - they need to afford to extend credit. But we need consumers too - we need them confident again that they can have a roof over their heads, feed their families, and support the economy by spending money (on things they can afford, yes a budget is necessary folks).
If we cannot restore consumer confidence we will NOT see a turn and as people get pushed more into survival mode rather than living a life things won't change and actually will get worse.
Lender owned properties represent 68% of pending sales in the last 30 days according to our MLS. Banks were never meant to be property owners nor do they want to be. So they price the homes to sell and yes folks they sell. The market is the market and when you are ready to buy there is a reason to do so.
1) you are an investor and you are preparing your retirement (my grandma bought 8 homes starting at age 50. From 78-85 she suffered alzheimers and that rental income paid every penny of her care all those years and left each of her 5 daughters enough proceeds to each have a home free and clear.
2) you don't want to throw money away on rent. Truthfully - in some circumstances renting is better for now. If you are risk advertant then stew for a few months to see what roles out from our government. But if you are highly qualified now could be the best time to be aggressive on some offers and realize you will take a loss (up to 10% as a projection) before you see a gain but the plan would be to stay in the home long term.
Real estate is cyclical. On the local level Arizona has become more affordable and we will see the return of jobs/employers yet the bumps are not over. We have no natural disasters to worry of, great weather so our turn to recover is a better outlook.
While I have much more to say, I"ve said to much. To Trisha - simple - have a very informed Buyers agent represent your interests. If they interview you well then they will advise you on all your options - not just tell you to buy, buy, buy. They will help you look at all your choices and guide you to successfully achieve the goal you set out to accomplish. They will also remain available whether you buy now or years from now. Great Realtors do exist! We can be just a phone call away.
All my best
Laura Myers PLLC, e-Pro, GRI
Keller Williams Arizona Realty
9500 E Ironwood Square Dr Ste 101
Scottsdale, AZ 85258