Michael Sells The Bay

We all know what happened in 2006 as the economy felt the beginnings of the collapse of the real estate market. That slow spiral of death into oblivion that has landed us here in 2010 with little to show for the lesson learned is rather disturbing to say the least. So now what? Well, consider this and then lets discuss some solutions. If someone bought a property in 2005, with an adjustable rate mortgage/loan, on a popular 5 year adjustment contingency, then there are some factors at work her in 2010! Experts tell us that we are about 60% of the way through the residential foreclosures nationwide, and only at the beginning of the commercial property foreclosures! Yeah! While I have some concerns, I am not seeing this as the proverbial meltdown, because certain factors are still holding back the hordes. The fed has managed to keep the rates in check against all odds. This is good news for those who managed to survive the first wave of mortgage failures and foreclosures, and they may actually survive their resets! As long as all the pieces of the puzzle stay as they are. That means that the banks will continue to hold their money, making loans only to the most qualified. Secondly, the average American must continue to save their money at historically high levels. And lastly, employers will keep a SLOW and measured handle on their hiring, which seems counter to the recovery, but is essential. IF any one of these elements reverses, we will see inflation that will make the Jimmy Carter years look like child's play. For those of you who bought in 2005, congratulations on making it this far. I pray the interest rates hold and you are able to secure your home with a mortgage you can afford. Tread lightly and hit your knees... And to those of you thinking about jumping into the home ownership market... remember that as time goes by, more and more people holding back and saving their money for a purchase will at the first provocation jump into the buying market with both feet, and we could see a feeding frenzy of activity as buyers move to buy low and hold for through the next real estate cycle. At what cost will you wait for your opportunity? Michael Thomas Realtor, E-Pro Keller Williams Realty Palo Alto, CA 94301 800-635-2493