Home (Bitter) Sweet Home
You’ve probably heard the saying that the real estate market is cyclical. There’s a lot of truth to that – property values rise and fall like the tides, though not quite so frequently, fortunately. Right now, the real estate market is in a nose dive and there is no end in sight. That’s unfortunate for homeowners who are already “upside down” or “under water” or whatever may be the catchword of the moment. It simply means that your property is valued for less than the total outstanding debt that you owe on your mortgage.
It may be construed as bittersweet, but those low property values are ideal property values for the first time home buyer. Experts are estimating that property values will continue to decline over the next year or two, and could drop an additional 10% to even 20%. Now, and in the next few years, it will be the so-called “buyer’s market.” Prices will be low and are expected to get lower still. Interest rates for mortgage loans are currently in favor of the homeowner, and should stay that way for a while. And there will be an abundance of homes available in every price range and every style you could possibly imagine. A glut of available homes, either through conventional sales or foreclosures, would not be an understatement.
No doubt, we’ve seen the backside of the illusory home buying mortgage schemes of the past several years. What do I mean? You probably can remember the ads – “Own your own home! No money down! 2% Adjustable Rate Mortgage” – good riddance to bad rubbish, I say. That’s what got us in this mess in the first place. No, I’m talking about “real” home ownership, like that of a generation ago, the kind that came with a sizeable down payment.
If I were a first time home buyer, I’d be wringing my hands together in anticipation of unlocking the door to my new home. It’s still the American dream to own your own home, after all. To paraphrase a famous line from Gone With the Wind, “tis the only thing in the world worth workin’ for, worth fightin’ for…” Now, I’m not saying, “dying for” cause there’s really very few things worth my life, but work and fight for, absolutely. A home is definitely worth that.
And that leads me to this point: You do have to work for, and maybe even to fight for it, if a home is really what you want. If it is, then now is the time to start training, because it isn’t necessarily going to be easy. Especially if you’re in the same boat as the majority of other people in this country, which means that you’re currently living beyond your means.
Now is when you have to take a good hard, honest, look at your debt and find a way to organize it, so that you can save towards your goal. With completion of our free one-on-one debt analysis, DebtStoppers attorneys can help you find a way out of your debt and, perhaps give you enough breathing room in your budget to actually allow you to save some money to be put towards a down payment on your home. Just like home ownership of old (i.e. less than a decade ago), from the day you move into your home, you’ll have equity in it.