New Home Buyers Can Find Bargains
March 27, 2008
Consumers often hear a great deal about the downside of the housing market but rarely hear anything about the upside. The upside to the housing market is that home prices are dropping and in some cases this could be the very best time to buy a new home. This can be especially true for those who are currently renting and do not have a house in which they must sell before they can buy.
Depending on your location, home prices are dropping significantly. In many areas there is also a huge inventory to choose from and the truth is interest rates are still relatively low. When consumers add in the foreclosures that are currently available there are a lot of good options for new home buyers. It should be noted by those who are looking or thinking of buying that bank-owned properties are often making up the majority of some real estate agents portfolios.
An example of how price is being affected comes from Brentwood, Calif., just east of San Francisco. Homes that were priced at $700,000 to $800,000 are now being reduced and listed at $450,000 to $500,000. These same kinds of reductions can be found in many areas of the country today.
The reason for the reductions is simple. Many homeowners simply could not afford the new payments when their interest rate increased on the adjustable rate mortgages. The homes end up in foreclosure and the bank, wanting to sell them fast, reduces the price.
“In many locations, homes are becoming more affordable, and mortgage rates, though somewhat volatile over recent weeks, are still relatively low,” said Tom Kunz, CEO of Century 21. “”This is one of the best times that a first-time home buyer has had in a long, long time,” he added.