This real estate situation may be ripe for many who have saved enough and are in a comfortable situation in terms of finances. With the houses now available at amazing prices and the additional option of resale homes, the choices have become wider and interesting. In fact, the sales of resale homes have really picked up in the last three months and most states are reporting reduced inventory every month.
However, the inventory is going to rise once the banks impose the foreclosures on many homes they have been holding back. The reluctance in enforcing foreclosure was due to the mortgage modification or assistance programs. Since the economy has not revived in terms of employment, most programs have not had the desired effect, which has lead to even more foreclosures. In fact, some of the modification programs have acted as nothing more than stopgap measures.
Once the foreclosed properties hit the market nationwide, one can see another spate of price decrease, especially in the resale segment, which will have its bearing on the new constructions as well. What this would also mean is the buyer will have more choices and greater bargaining powers. The bargaining power could also be exercised to negotiate the interest rates and the total price of the house. Individuals with a good FICO score should ask lenders to give them the best interest rates, since the interest rates are falling every month.
In addition, there are more people defaulting due to the current economic slowdown and loss of jobs. Therefore, one has to sit pretty and make the bankers and sellers work for you. Sellers are also keen on getting the properties sold quickly since the forecast is further decrease in prices. There is also a segment of distressed sellers who are now not able to afford the home loan repayment and want out. This further increases the competition amongst the sellers; however, the need for cash will overcome most resistance and many would settle for less. If there are some who are ready to shell out good money in a shorter span, then the sellers can also look at much better (lower) deals. The key, therefore ,is money in hand and future payments.