As this meltdown begins, what should us small fry be looking for in terms of deciding whether to buy. Let us assume that we cant wait for the bottom of the market, but clearly want to be in the slide when we are looking (things are still real sticky now).
For example, even with resets of arms and their resulting foreclosures what is the time frame before we should see them on the market. If 500 foreclosures happen today, would they be on the mls or available for purchase in a month, two months or 6 months. Since there are a number of legal issues associated with the process there should be a considerable lag.
Also are we all holding our collective breathes to find out how many people are gonna put their property on the market this spring? This could be a bit of a flood, but should still be sticky for a while.
I have noticed that NODs typically spike in March (foreclosureforum source), are we expecting NODs to spike 10-15% this month? Will this spike stay constant through the spring, will they still be going to default at 30-35% for the foreseable future?
I’m not even going to consider getting into SoCal real estate until at least 2008. And by that, I mean actually doing the math, looking at whats available, etc. In the mean time I’m just going to enjoy the fireworks.
The main indicator I’m watching is foreclosures. Once that stabilizes I feel we will have gotten close enough to the bottom to consider buying. If the foreclosures are holding and the median is still dropping, I’ll turn to watching that.
Once the indicators have stabilized, assuming I’m cash flow positive and still have a job, I’ll work with a realtor to find me maybe a dozen properties that meet my criteria. I’ll then put out a low-ball offer (maybe 10% under) on all of them and see if I get any bites.
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