The National Association of Realtors almost never has a bad home-buying day. Their 20 year mantra has been it’s ALWAYS a great time to buy a home. And, if they would just add the “for some people” onto that phrase, they’d be correct. It’s currently a great time to buy a rental property, and investors are doing just that to take advantage of rising demand and rents.
With the better May-to-June performance reported by the S&P Case-Shiller Home Price Index, Lawrence Yun, the NAR’s chief economist says that’s good news, but “there’s plenty of room for improvement.” The NAR is very much blaming the tighter mortgage underwriting standards for the continued ill health of the market. Their stance is that if underwriting standards would return to “normalcy,” the market would begin to improve very quickly.
Of course, what’s “normalcy?” If it’s the lax standards of 2001 – 2006, nobody is going there again. With the federal government looking at how to take on less of the mortgage-backing and insuring activity by Fannie Mae and Freddie Mac, there’s a large gap left between that easy insurance and the willingness of the private mortgage market to take over.
Some analysts are looking at the wavering ups-and-downs of prices in the major indexes as a good sign. It’s like chart-watchers who invest in the stock market based on the patterns of stock price activity. The rapid price decreases seem to have slowed or stopped in many areas, with some improvement beginning to show as well around the country. After a sustained down-trend, prices many times will tend to stabilize and stay in a narrow area before they turn and go the other way. Some say this could be that bottom everyone’s been looking for.
One quote from Stephen Stanley, chief economist of Pierpont Securities, points out his thoughts about an interesting bifurcation in the market: “Distressed property values remain depressed – a drag on home prices. But, non-distressed home sales are starting to rise.”
Investors take note. You can buy trashed out foreclosures cheaper than ever, and buyers are beginning to show signs they want to buy livable homes and pay more for them … a rehabber’s dream situation.
The National Association of Realtors almost never has a bad home-buying day. Their 20 year mantra has been it’s ALWAYS a great time to buy a home. And, if they would just add the “for some people” onto that phrase, they’d be correct. It’s currently a great time to buy a rental property, and investors are doing just that to take advantage of rising demand and rents.
With the better May-to-June performance reported by the S&P Case-Shiller Home Price Index, Lawrence Yun, the NAR’s chief economist says that’s good news, but “there’s plenty of room for improvement.” The NAR is very much blaming the tighter mortgage underwriting standards for the continued ill health of the market. Their stance is that if underwriting standards would return to “normalcy,” the market would begin to improve very quickly.
Of course, what’s “normalcy?” If it’s the lax standards of 2001 – 2006, nobody is going there again. With the federal government looking at how to take on less of the mortgage-backing and insuring activity by Fannie Mae and Freddie Mac, there’s a large gap left between that easy insurance and the willingness of the private mortgage market to take over.
Some analysts are looking at the wavering ups-and-downs of prices in the major indexes as a good sign. It’s like chart-watchers who invest in the stock market based on the patterns of stock price activity. The rapid price decreases seem to have slowed or stopped in many areas, with some improvement beginning to show as well around the country. After a sustained down-trend, prices many times will tend to stabilize and stay in a narrow area before they turn and go the other way. Some say this could be that bottom everyone’s been looking for.
One quote from Stephen Stanley, chief economist of Pierpont Securities, points out his thoughts about an interesting bifurcation in the market: “Distressed property values remain depressed – a drag on home prices. But, non-distressed home sales are starting to rise.”
Investors take note. You can buy trashed out foreclosures cheaper than ever, and buyers are beginning to show signs they want to buy livable homes and pay more for them … a rehabber’s dream situation.