Current Market Conditions

The current market conditions are confusing to say the least. Sellers trying to sell their house are finding out that their house might be worth less today than when they bought it a couple of years ago, buyers are finding it harder to qualify to get a loan with the increased tightening of credit by the banks, and interest rates are going up rather than going down like logic would seem to dictate. What is going on?

The good news is that everything in life seems to be cyclical. I have heard phrases such as: history repeats itself, what comes around goes around, and the market makes adjustments and things always bounce back. That all sounds well and good, but what do we do today about all of that? Most people don’t know when that cycle will come back and the people being affected today aren’t too concerned about what happens two years from now. It seems like a vicious cycle that in all honesty would be better if there was some clarity to it.

My suggestion to a seller is to identify why they want to sell. If they have to because their job is being transferred, then there isn’t much choice. If it is because the family has grown out of the size of the current home, again maybe no choice. However, if someone is wanting to sell their house, then maybe the best thing to do is to dabble at selling it. In other words, aggressively try to get it sold at a price you feel comfortable with, but at the same time not get to charged up about it and dream of that new home you want. The difference between “have to sell” and “want to sell” are two different things. I know that is a hard thing to separate, because we live in a world of wants, but taking a more relaxed approach and testing the waters might be the best approach in today’s market. If the house gets sold quickly, trust me, finding a house to buy isn’t going to be overly difficult.

My suggestion to a buyer is to make sure that you can afford what you are buying. Get your finances in order and make sure that a new house is affordable. Make sure to take into consideration the expenses that might not be seen on paper. You need to look at the house payment, but what about the other expenses involved like: landscaping, improvements, utilities, etc. Those expenses are important to consider as well as the principal, interest, taxes, and insurance payment. The other thing to think about is down payment. Lenders have tightened their grips so much that most loan programs require some sort of down payment. There are only two or three programs still available that require no money down. There used to be several programs. Not any longer. Get into the savings mode and save some money for a down payment. One of the most rewarding things about having a down payment is the fact that when you do buy a house, you feel like you have put part of your soul into the purchase of that home. There is a feeling of accomplishment and a dedication to that house more so than when you don’t put a penny of your own money, your owe blood and sweat into the transaction.