Bear Stearns is dead, we are bailing out our banks with US funny money and help from the Saudis, the rest of the world is buying us up with their stonger currencies, Budweiser is for sale, Ford is liquidating assets, gas is beyond belief with no end in sight, a gallon of OJ costs $10 in Hawaii, and the foreclosure market hasn’t even started yet.
Banks are offering bulk portfolios of homes in default at significant discounts.
These are homes that may not be for sale, are not in foreclosure, are “preforeclosure” and the banks want to wash their hands.
Many are in Temecula/Murrieta, and basically the offer is say $2m of mortgages for $1m. Now you own the paper, and you foreclose and kick out the former owner.
And the deals get better as the portfolio gets larger.
So TG, when you talked about the banks holding back, well, they are now looking for buyers. Can’t sell to other banks anymore, so now package deals for investors.
So many of you scoffed at my $75 sq/ft prediction in Jan 08, it will happen. Might only be a few homes, and you may never have a chance to buy it, but it’ll happen.
Also as loans are harder to get, and interest rates rise, that will freeze out many more buyers and prices will continue to drop.
For those of you who absolutely have to buy right now, get a 30yr fixed loan and make sure you are around $100 sq ft. And make sure you REALLY LOVE the home.
The seemingly great prices are like fools gold, it only seems great because prices were at artificial, bubble heights. The theory of “well I’ll be here for 10 years” justification is also problematic. But life happens, and what if you need to move for good or bad reasons, your seemingly stable income disappears, etc., and now you are underwater and can’t get out?
It is not truly a buyer’s market yet, there are deals, but be careful.
