Yes it is almost year end and I think it is time to look back on 2010 and view the changes that effected our industry.
The word value was replaced by the word foreclosure. This change was not a good one. Folks often mistook buying a foreclosure for buying a value. Often times people said, "we want to see foreclosures." The foreclosures were sometimes good deals but not always. Some folks listened and bought something that was a better value and not a foreclosure. Others unfortunately just saw that word.
Short sales continue to be problematic. Depending on the number of liens and the lenders involved the only thing short about some short sales was the Name Short Sale. Buyers got frustrated over the length of time it took to make a deal happen. Some short sales went into foreclosure mid negotiation. Buyers were surprised and aggravated when banks did not take their low offers.
Loan Modifications were slow. Despite a well intentioned program that makes a lot of sense Banks did not implement loan modifications with any rhyme or reason. We did see these things done. More often than not we saw home owners throw up their hands and end up in foreclosure. The program has not been as successful as it was hoped to be.
Interest Rates remained Low. If you asked just about anybody at the start of 2010 where interest rates were going you would have heard up. This is especially true as the Fed stopped buying Mortgage backed securities. But the opposite happened. Rates went down and currently hover at historic lows. Why? Maybe because mortgage backed securities are considered a safe haven especially after reforms
Special incentives. We saw special buying and move up incentives end. Yes there was a dip in sales when these programs ended but we are seeing sales getting stronger as the year moves on. so a lot of the doom and gloom did not happen here.
Foreclosure processes stopped. We saw banks especially in Judicial states stop foreclosing on homes. This happened largely because the clearing houses that hold the documents that track ownership and the banks that are supposed to check them had such a volume of work they got sloppy. Some folks thought , good I do not have to pay My mortgage. Those folks were unpleasantly surprised. It would seem that this problem barring government intervention is actually being well addressed and being fixed.
Land Sales suffer. Due to a lack of credit land sales really suffered in 2010. If you were not a cash buyer it was hard, very hard, to get a land loan. This problem effected the new housing market as well as homes are built on land. So the 2 markets land and new construction suffered from a lack of Credit.
2011 prediction
Barring an unforeseen economic catastrophe I see the housing market picking up. As people in depressed areas are finally able to sell they will move and stimulate other markets. The unemployment rate dropping her is really a key to making this happen. I think land sales will still be very slow for 2011, but I do believe there is a real pent up demand for home ownership. 2011 will surprise many by being a strong year in our industry.
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Charlie Ragonesi All Mountain Realty Big Canoe and Mountain Blog
On line at www.allmountainrealty.com Call at 706 579 1098
