Do You Believe You Can Get A Good Deal In Today’s Real Estate Market?
Posted: under Real Estate.
Tags: Allen Davis, Federal Deposit Insurance Corporation, Market value, Real Estate, Real Estate Market, Realestatesearchdirect.com, Technorati
Do you believe that you can get a good deal in today’s real estate market? Many people are reluctant to buy a house today because of the news they have been hearing lately.
Listen to a story of three home buyers. Buyer A, we’ll call Adam. Adam bought his house shortly after the last bottom of the market cycle. He was watching the market prices and waiting for prices to stop falling. Home prices had been dropping so Adam waited to buy until prices were on the rise again. He didn’t want to buy a home that was losing value, after all.
Adam waited until he was sure that prices were on the rise again to buy his house. By the time he was ready to buy, so were hundreds of others who had been waiting out the down market. It was hard to find a house that met Adam’s needs and when he did there were other people bidding against him on the same property.
Adam ended up paying more than the current market value to get the house he wanted to keep other buyer’s from stealing it away from him. Adam was happy with his purchase because within a few years his property had appreciated in value
Bruce, buyer B, bought his house 5 years after Adam. He kept hearing Adam talk about how his property had increased in value and Bruce wanted to get in the game. He had a hard time finding a property he could afford. When he did eventually buy, it was near the end of the upswing of prices.
After a year, prices started dropping and Bruce found his house was worth less than what he owed for it. Adam was disappointed to see his home value dropping, but he still had a house worth twice what he owed on it.
Carl (yep, buyer C) bought his house 2 years before Adam. When he was looking for a house to buy, the market was flooded with properties nobody wanted. Prices were dropping and everybody was afraid to lose money. But Carl knew how to find the good deals and there were plenty to be found.
Carl bought a house from a seller that had already moved to another state. The seller had been trying to sell the property for 6 months without an offer. The seller was tired of making mortgage payments on a property he didn’t want so he was willing to sell to Carl for what he owed on the property.
Since the seller had owned the property for 12 years and prices were still well above the price he bought it for, Carl got the property for half of what it appraised at. By the time Adam bought his house, Carl’s house was worth almost double what Adam paid for his, but Carl only owed half of what Adam owed.
Today there are even better deals than what Carl bought. The lenders are in trouble and need to unload properties or go under. The FDIC has already closed several big players down and more are on the edge of failure.
Comments (8)
Jan 10 2009
