Housing Market: 5 Years Later
MAJORITY OF COUNTRY, HOUSING COST IS IN GOOD SHAPE, IF YOU ARE SOMEBODY TO WILL BUY A HOME LIVE IN IT FOR A LONG TIME THE PAYMENT IS WHAT COSTS YOU OVER THE LONG TIME I WOULD FOCUS ON THAT. GERRI: I KNOW A LOOT OF PEOPLE TALK — A LOT OF PEOPLE TALK ABOUT THE MIX OF BUYERS WITH INVESTORS AND FOREIGN BUYERS, PEOPLE PUT DOWN ALL CASH. HARD TO COMPETE WITH THAT, IS THAT GOING TO CHANGE, SAY NEXT SPRING? EVERYONE IS this website FOCUSSING ON THAT REMEMBER WE HAD A SPRING MARKET? >> YOU KNOW, I THINK A LOT AS CHANGED IN TWO MONTHS WE HAVE WORD A LOT OF FOREIGN BUYERS HAVE PULLED OUT OF SOME OF THE EXPENSIVE MARKETS AND MOVING ON FLORIDA AND MORE LESS EXPENSIVE MARKETS, CAPITAL IS SHIFTING, BIG INSTITUTIONS HAVE SLOWED DOWN THEY ARE BUYING BECAUSE WHOLE THESIS IS SHOT. BUT WHAT I SEE REPLACING THEM IS FLIPPERS COMING IN I SEE ADS ON TV TO COME MAKE $30,000 A HOUSE FLIP, EASY MONEY.
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What Could Stall the Housing Recovery
According to reports, close to half of the loans issued in 2006 were subprime, and when the economy took a hit and people started losing their jobs, home prices dropped and homeowners started defaulting en masse. In the years following the bursting of the bubble, the credit markets essentially froze as banks became more risk adverse after getting burned by loose mortgage practices. Weve experienced a near full reboot of mortgage lending standards, back to those commonly seen in the 70s and considerable portions of the 80s and 90s, says Gumbinger.
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On top of it all, Americans are getting less for their money because of the rise in home prices. Its not looking good right now. So why did the housing market appear to be doing so great, and what led to all of these changes? Well, when interest rates hit the glory days of 3 percent, investors knew it wasnt going to last long, so they took advantage of it. They bought tons of homes across the country.
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