The sky is falling, the sky is falling! According to the Chase-shiller index we have entered a double-dip economic recession. Clear Capital reported the same thing for the housing market nearly a month ago. Zillow added that home prices are dropping about 1% per month this year. The headline read, "First Quarter Brings More Dismal News For Housing Market." With that headline you can guess where the article went.
The sky is falling! Well, that's one way to look at it, or it could be the biggest buying opportunity in nearly two decades. A lot of people were priced out of the real estate boom of the early to mid-2000s. The escalating prices of available properties made it impossible for them to buy. So, they settled in and started renting. They have sat back, saved their money and now they have enough money saved to buy the house that alluded them five years ago and they have a nice down payment.
For a lot of these formerly sidelined buyers, this market is ripe for the picking. Many buyers overbought in the mid-2000s, and now the real estate landscape is littered with wonderful upscale short sales and foreclosures. It's a buyers dream.
So, for those Realtors who have been walking around with a sad depressed face, I say, "Take that sad face off, put your 'I'm going to be a top producer' face on and get out there and beat the bushes." First-time buyers and sidelined buyers have the potential to be a major force in this market turnaround.
There is another group evolving in this market. The people who were wiped out in 2008 are stabilizing and coming back into the market. This is a great group to get your investors involved with. If your investors would become short-term mortgage holders that would give this group a hand up. The real risk to the investor is the potential that the buyer may default, but many of these people were swept away by forces other than own fault. They are trying to do everything they can to get back on top of things. The worst case scenario for an investor is that he would have to foreclose. In that case, he would simply have the house he bought anyway. It's a win-win.
So, Realtors, put away that "sky is falling" umbrella, pick up a bucket and catch the rain of re-positioned buyers. The clouds are full of opportunities and it's beginning to sprinkle. We can pull this country out of this hole one buyer at a time. So, everyone, heave-ho!