The what if’s about real estate
- If they foreclose on the millions of properties
- The banks will be stuck with millions more
- People will have trouble getting loans if…
The what if’s about real estate, there are many with many more coming. There seems to be an increase in foreclosure activity. However, the lenders are stuck between a rock and a hard place.
If they foreclose on the millions of properties that are in default or at least delinquent, then the increase in inventory will drive prices back down just when they were accelerating in many markets. If the economy starts to drag even more than it is and becomes a full blown depression then there will be not buyers for the bank owned properties.
The banks will be stuck with millions more that they already have to pay property taxes on, keep them up, pay homeowners dues, and that is not be an ideal position. Billions of dollars would have to be spent monthly just owning these repossessed properties. If the inventory increases then it becomes a buyer’s market. Buyers with cash will move to the front of the line as lenders want to get rid of their properties as fast as they can.
People will have trouble getting loans if the job market looks shaky and the economy has more quarters where it stumbles. Everyone is also keeping an eye on the holiday retail sales. Be prepared to see exaggerated sales numbers in order to get people excited and hide the real danger that the economy and housing market are in for.
QUESTION: What should readers take away from this message today?
ANSWER: That banks are not as excited as you think about repossessing properties.
QUESTION: Why is this information timely?
ANSWER: This information is timely because the number of cash investors has also dwindled. They are not looking for more properties to buy and rent out.
QUESTION: How can readers best apply this information to their lives right now?
ANSWER: If you are thinking of selling your home you should be the lowest price in your neighborhood and be showroom ready in order to sell now.
COMMENTARY: Real estate is loaded with “what if’s” just like other tangibles. The mantra of traditional economics suggest that investing in things like real estate is necessary to secure your future. It’s called financial planning. How can you follow these traditions in such an unstable economic environment? Answer is you can’t, at least not if you are expecting these traditional investments to provide for your financial future. Listen to your intuition…”your spirit guides” if you want to actually achieve a worthwhile future. It all depends on you now.