Everyone is wondering what’s in store for real estate this year. Although there are many conflicting opinions, the overall picture is not as dire as some report. Markets in different parts of the country vary greatly. Although some will be down this year, there are many areas that expect continuing growth.
FHA loan applications have been rising significantly and HUD’s endorsement of FHA mortgage loans have risen 58% while refinances have risen 23%. This means that first-time homebuyers (the backbone of the real estate market) will be able to enter the market using a safer, lower interest rate product than the riskier subprime loan.
With the dollar’s decrease in value, buyers from foreign countries (especially Mexico, Britain, and Canada) will increase according to the National Association of REALTORS®. And as more baby boomers move into retirement age, the second home market should remain healthy this year.
Consumers will need to readjust to more modest growth in the market. Gone are the days of “get-rich-quick” house flipping schemes. But in spite of the overall slowdown, homeownership still remains a secure and valuable long-term investment.
One of the highest priorities among high-end homebuyers and sellers is privacy. Marketing a multi-million-dollar home that contains valuable art, jewelry, antiques, home furnishings and clothing is often done through the real estate agent’s select contacts, to preserve the personal security of the client.
Many exclusive homes never make it to the MLS service, because the agents who represent the sellers introduce the property selectively. Agents who are familiar with the luxury market know that finding a buyer is often a matter of great detective work. For every upscale home, there is an ideal buyer among a target group with a high probability of interest in such a property. One of the secrets to success among agents who work with very high-end clients is that they are able to market the home directly to the right buyer pool, instead of casting a wide net that draws in people who are merely fascinated with the high-profile lifestyle.
The client’s business manager or financial advisor will often be the working contact in the negotiations process, while the client remains secluded. Luxury home marketing requires extensive networking on the agent’s part.
For the last few years you’ve been toying with the idea of purchasing a vacation property or retirement home next to your favorite golf course. What are you waiting for? There are many factors in the real estate market that have conspired to make this a very good time to buy. Here are a just a few.
Even though we are experiencing a post-boom market, continuing low mortgage rates combined with larger inventory and more reasonable pricing have created an excellent window of opportunity for the buyer.
Over the past 20 years we experienced one of the longest running fiscal expansions in history, resulting in financial affluence for many people. This growth brought an extraordinary equity increase in primary residences and provided extra financial strength for those who are entering their retirement years.
The unpredictability of the stock market has many investors seeking the relative stability of the real estate market. And even though the market in general is slowing, the second home sector will be a strong investment for years to come.