Real Estate: Make Millions Buying Now! ? Real Estate ? U.S

Have you heard about the ?Sub prime? mortgage dilemma? What about the real estate ?bubble?? If not, you need to crawl out from under the rock where you have been living and turn on the news or read a paper! Or maybe it is best you don?t. This has been the ?Hot? topics of late. Pair sub prime mortgages with the real estate ?Bubble?, and the media would have us all believing the world is coming to an end. It is amazing when there is lack of disaster or national travesty, what the media chooses to focus on.

While it is true that there are new restrictions on the lending industry when it comes to sub prime borrowers (individuals with less than perfect credit and little or no money down), we need to evaluate what impact that is having on the real estate market. Although the ?liar loans?, as they have come to be known, or stated income/stated asset, have been eliminated, FHA is still going strong. In fact these loans have increased dramatically as first time home buyers seek alternate loans. This program is much less dependant upon credit scores. It allows the use of one of the many down payment assistance programs currently available.

Really, when you analyze what percentage of loans are actually made to sub prime borrowers, you begin to see that it is a smaller number than what is being blasted across the news. The sub prime situation is not quite as devastating as the media would like us to believe. What is that you say? Do you mean to tell me that the media has exaggerated the truth? Would this be the first time that information has been distorted to bring a ?story??

So what is really causing this slow down in the real estate market? I am glad you asked! First and foremost, we are over built. Builders across the nation have been churning new homes out faster than they can sell them. Due to heavy demand and the ability of buyers to obtain financing at will, the builders have made a fortune selling new homes. As these homes began to saturate neighborhoods across the U.S., and lenders began to tighten restrictions, the buyers began to dry up. Understandably the builders were not ready to give up their cash cow. They continued to produce these homes with increased vigor, almost like a production assembly line. The buyers needed to sell their existing home to purchase the new builds. It began to create a false lull in the real estate market. All of a sudden markets were inundated with excess inventory. In areas even where there are many jobs being created, the home inventories have increased dramatically. Coupled with the media doomsday report, it actually fueled these slow downs and ?created? a real problem.

The next crucial element is the record numbers of foreclosures being realized across the nation. The same lenders who are now tightening their guidelines were offering mortgages to anyone who could fog a mirror. To top it off they were putting buyers into these teaser loans or adjustable rate mortgages. These were temporary low rates that readjust after a set period of time (usually 2-5 years). Once these rates readjust, buyers find that there payment has doubled and sometimes tripled! Can you imagine just being able to qualify for the monthly payment that is being offered to you on this ?teaser? rate only to have your payment skyrocket after the adjustment? No wonder there are so many foreclosures.

This presents the next problem. Where do these foreclosures end up after they are taken back by the bank? You guessed it. They stay right in the nice neighborhood they have always been in. But guess what? The bank writes off a portion of their loss and put it back on the market, sometimes at a big discount (usually much below similar home sales in the neighborhood). What is it that appraisers use to determine a homes value? Recent sales comparables? That is right. All of a sudden these foreclosures become the new sales comparables, and that is the beginning of the decline in value of a neighborhood.

Now what can we do about this situation? I am glad you asked! As interested parties, investors, or home buyers, we need to buy these homes before they go into foreclosure. If you don?t buy before foreclosure you can still pick up phenomenal deals after the foreclosure sale! Well now you say (to the chagrin of the media) ?why would I buy now, you just said homes are declining in value?? It needs to be noted that when everyone else is selling you need to be buying. When everyone is buying you need to be selling. Do you see the logic in this? If you are one of the few sought after buyers in a buyers market, you can set your own terms and price on a particular property or move to the next one. You want to position yourself to be in the drivers? seat.

The way I see it, if the market is saturated with inventory, there are many motivated sellers willing to be a lot more flexible than they were during the sellers market we just came out of. You have many more opportunities to purchase property at a significant discount or excellent terms. I can not stress to you enough you must buy all of the properties you can possibly buy right now. There were millionaires made during the depression. How you ask? Because people were willing to find opportunity amidst opposition.

When you look at a graph that indicates real estate values beginning in 1900, the overall big picture indicates a marked increase steadily over the years. There are ups and downs along the way, but looking at the big picture the values have always increased. If history continues to repeat itself and offer a look into the future, then NOW is the time to buy, buy, buy! Many experts agree that the real estate market will correct itself within the next 18-24 months. This gives you an unfair advantage over the general public. If there were ever a time to step out and take a calculated risk, now is the time! Just think how you can position yourself if when the market turns around (and it will) you are holding multiple properties that suddenly increase drastically due to supply and demand. Don?t be one of the masses who succumb to the media detriment. Don?t let this opportunity pass you by. I urge you to be one of the few who seize the opportunities set before you, and prosper from it. So get out there now and BUY! ?Scott Woodhams

www.guaranteedmaximumreturns.com

By: Scott A. Woodhams
Posted:

Source: http://www.cochlearprojects.com/2011/08/real-estate-make-millions-buying-now/

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