Archive for December, 2009

With the economy tanking over the past year plus, the real estate business took a hit also.

In my opinion it was never the market that was hurt, only the money business that became the problem. Mortgages were hard to come by as the federal Government stepped in and threw heavy new regulations to those that loan money for housing. Loose lending practices led to this clamp down over the past few years and loans were made to those who could least afford them. Thus foreclosures were plentiful when owners couldn’t pay the heavy monthly payments they signed on the dotted line to pay. We are left with a weak buyers market and lots of homes for sale.

Whose fault was it?

Actually it was the fault of the government who wanted more people to be able to own property thus they encouraged lenders to loan to as many as possible, relaxing the rules  and since the lenders are in the business to make money they did just that to excess. Our economy is profit driven and when government agencies encourage profit, profit becomes the goal. there were attempts over the years to tighten regulations by some law makers however a segment of the congress fought to make more housing available to more people thus allowing lenders to make loans to those who couldn’t afford them. The system collapsed on itself when those buyers couldn’t pay the mortgages and as a result foreclosures became the rule instead of the exception……

As money becomes available

more and more in the coming months sellers will be able to find buyers and the “House for sale” inventories should shrink thus creating a more stable and thriving market. The trend in my eyes for the future is good and the business especially in Central Pennsylvania is solid. Inventories are already shrinking and there are more buyers out there. As the money sources become more available competition to buy property will increase and prices will move upward again.

Just like all other businesses,

the real estate market has it’s ups and downs. However interest rates are low and inventories of available properties are plentiful. I believe the trends now are positive for another real estate boom to happen over the next few years.