Today's news from the Mortgage Bankers Association that mortgage applications jumped from an eight-year low could be a sign that we're starting to see a turnaround in the housing market. But don't get your hopes up too high if you're trying to sell your house. Many of the mortgages being taken today are being used to purchase foreclosures and short sales. If you're holding on for a better price, you probably have at least a year to wait.
Most economists still predict that we won't see a bottom in the housing market until mid to late 2009. Maybe all the cash being pumped into the system is finally starting to work and will speed up the process.
The good news is that people are back in the market to buy homes. We must clear out the backlog of foreclosures before we'll see any significant jump in sales of new and existing homes. As was reported last week, existing homes sales jumped but prices dropped 9%. That reflects the fact that most of the existing home sales were distressed sales.
I know from talking with realtors in my area in Florida that people looking for property ask to see only the foreclosures and short sales. And most homes are still sitting on the market for 12 months or more. The few homes that have sold in my neighborhood were foreclosures, short sales or homes sold at prices to compete with these distressed sales.
Lita Epstein has written more than 25 books including, "The 250 Questions You Should Ask About Buying Foreclosures" and "Reading Financial Reports for Dummies."
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Reader Comments (Page 1 of 1)
10-29-2008 @ 4:25PM
Mortgage said...
This was a good article. It's always good to hear that there is hope for your mortgage . Good info
10-29-2008 @ 6:54PM
william lindblad said...
Welcome back.
Yes, no & maybe.
They surge of buying may be the result of a backlog of those waiting for an opportune price and moment. Not all are mortgage deals, as some are outright purchase but all get counted the same way. Since I am part of the statistics - I know. I am sure most are default/distress but that is what opportunity is. If it keeps up next month than it has meaning, if not, it is simply an anomaly where most of those waiting went shopping at a similar time.
I did say this was going to happen, however it worse than I expected.
10-29-2008 @ 7:03PM
Lita Epstein said...
Hi William,
Good to see you again. Sorry I've been absent I was working on two books that will be out in January - "Surviving a Layoff" and "Complete Idiot's Guide to Value Investing.
I agree with what you say. I do hope we continue to see this upward swing, but it may be just an anomaly.
Lita
10-29-2008 @ 8:44PM
Jesse W said...
always a positive to see mortgage applications increase; now we just need to see it remain steady or continue to increase!
Jesse W.
http://www.subprimeblogger.com