Three years after the collapse of the real state market, we still wonder if we’ve seen a bottom yet. Some say we did and many more say not so. The June 2011 existing home sales report was released this past week and it’s more of what we’ve been getting for some time.
Existing-home sales eased in June as contract cancellations spiked unexpectedly, although prices were up slightly, according to the National Association of Realtors®.
Why is it that every month lately when any economic report is released, it contain the word “unexpectedly”? How can they be surprised? Yes there have been buyers out there keeping the market moving, but are they moving at the right time?
Look around in your neighborhood and I’m sure you will see many “For Sale”, “Bank Owned” and “Auction” signs. That’s only part of the story, the other part is the fact that the unemployment rate is still unstable in many areas of the country. The reason I bring this point up is that if people are not going to work, they’re not going to buy a house. To add to the matter, is the fact that there are still home owners who are in the beginning stages of foreclosure. so how is that going to help when more people are losing their homes?
Analysts feel that there is some devaluing still to come. For those looking for some real estate investment advice, I want to tell you to wait. Some feel that there’s at least another 10% drop left in the housing market, so why not wait? Being patient is the best thing you want to do. Yes you want to get the possible best price on a home, however if you jump too quickly, you may find out that you didn’t catch the bottom, but now you’re riding it out. Taking your time may cause you to miss the bottom, but at least the value of your home will rise as the market picks up strength. Chasing the bottom is not the wisest thing to do. Just like trading stocks, you most likely will not catch the bottom. Like Jim Cramer from Mad Money says… “Bulls make money, Bears make money and Pigs get slaughtered.” Chasing the bottom will only get you burned on an investment.
During that time you can also work on improving your credit score, so this way you’re be able to get a better interest rate when you apply for your loan. The magic number you’re looking to be over when it comes to your credit score is 740. If not, expect to pay a higher interest rate than what the bank may offer you before the paper work is started. A better interest also increases your profit.
Instead, take your time and work on your property investment strategies. Are you going to rent the property, fix it up and sell it quickly or is it for you and your family as your new home? Most likely, you’re thinking about using it as an investment and in that case you must remember that you don’t make you money in real estate when you sell your property, it’s when you buy it. That’s right, i’st important for you to work out the numbers good enough so you can increase your investment when you purchase it.
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Thanks for the great thought leadership!
Dennis Carpenter´s last post Keep it Simple – Just Five Circles
Good advice, but I hate the thought of people losing their homes…it’s tough out there.
Great info. I’ll have to look at your site when I’m getting ready to purchase property.
Sukhraj Beasla´s last post Wordless Wednesday: The Chocolate Cure
Twitter: joannegreco777
says:
Jeanette, what number was the twitter counter at? Sometimes it takes while to register.
Twitter: billyakerman
says:
There are so many uncertainties in our economy now. So much so that long term unemployment is now looked at as five years instead of the customary two.
Jeanette,
Thanks for letting me know about the tweets.
Billy´s last post U.S. Credit Rating Is In Danger
Besides the uncertainty of property values, I wonder what the long term instability of families renting and not having a firm foundation of a home will mean.
BTW, I refreshedyour page and did not see the twitter count increase after I tweeted it.