Maronda Homes News

Housings Up Housings Down

Don’t you just love the Real Estate and Investment writers that announce THE HOUSING RECOVERY IS HERE, and then one week later tell you THE HOUSING RECOVERY IS THREATENED.  Just last week the New York Times published “After Years of False Hopes, Signs of a Turn in Housing which was followed by Forbes, Morgan Brennan, with America’s New Foreclosure Capitals.  In Brennan’s article she points out that the housing recovery in Tampa could falter due to the large supply of homes in various stages of foreclosure.  She refers to the problems Banks have had getting properties through the foreclosure process due to Robo Signers and the fact that Florida is a judicial state which makes foreclosures more difficult.  It may help sell papers or magazines warning that a WAVE OF FORECLOSURES LOOM AHEAD but that ignores one simple fact that’s almost as sure as death and taxes.  Banks like to make money.  They have been holding what have mostly been non-performing assets for a long time and they want to get as much money from them as possible.

As the housing market improves, so does the value of the banks asset.  The last thing the banks are going to do is flood the market and let the price drop.  The only exception I can see to this is if the Federal Regulators or the State Government found a way to force their hand and made them liquidate all their housing assets at once.  This is very unlikely to occur.  It is not in the governments best interest to push down prices.  So the likely future will be a slow improvement in the housing market as banks bleed off their inventory of homes with non performing mortgages.  Houses will slowly appreciate in value and eventually things will get back to normal.  The bottom is behind us.  Investing in housing traditionally has been a good long term investment.  Owner occupied home ownership with a fixed mortgage has been an excellent hedge against inflation.  We don’t know if or when we will see an inflationary cycle but if and when we do, home owners will be in better shape than those that rent.  We are slowly seeing the old rules come back into play.

If you are currently renting, have a credit score above the mid 600’s, and have been waiting for the bottom of the market to come before buying a home.  It’s time.  Now is the time to decide between a  New or an Existing home.