TOLL FREE 1.888.420.MOVE(6683)
Every state in the USA except for Hawaii had snow recently, and the nation is a long way from springtime – which is traditionally the busiest time of year for residential real estate sales. Most of the country is still within the deep freeze of winter weather, and very few LGBT buyers are in the mood for looking at houses while trudging around in slush and slipping on icy walkways. But LGBT buyers and sellers do need to start looking ahead in order to prepare for the 2011 real estate market. This year promises to be a pivotal one as the general economy gains momentum and the real estate sector leads the way in that recovery. Here are some highlights of what to expect in the coming months, based on current market data, housing trends, and the predictions of many experts within the industry..
Interest Rates on Mortgage Loans.
The best news for both buyers and sellers is that mortgage interest rates are near the lowest levels they have been since banks started keeping historical records on mortgage data. That means that in 2011 it is possible to take out a home loan and get a mortgage that would make several generations of parents and grandparents jealous. .
To put today’s rates into perspective it is worth pointing out that during the past 50 years there were many times when Americans paid extra points to get a loan that was lower than seven percent. In fact many people were thrilled to get a loan that was under 10 percent. By contrast, rates on reliable fixed-rate loans today have been hovering slightly above or below 4.5 percent and are a bargain by any historical measure. .
But they are not expected to last forever, and the Fed has been wrestling with inflation for months while artificially keeping rates down in order to stimulate the economy. Once the economy appears healthy enough to handle it, rates will likely start going up and may never come down this far again – so those who want to take advantage of them need to act now. By next year these phenomenal rates and exceptionally attractive low monthly payments may be a relic of the past..
The Foreclosure Market.
The Massachusetts high court recently reversed two foreclosures, taking the homes back from the lenders who had repossessed them and returning them to the original homeowners. Justice Ralph Gants, writing for the Massachusetts Supreme Court, explained that the banks had “failed to make the required showing that they were the holders of the mortgages at the time of foreclosure.” In the wake of the so-called “robo-signing” scandal – which exposed the fact that lenders were foreclosing without reviewing documents or showing enough legal proof – the courts may hear thousands of similar cases in 2011. .
It is much too soon to predict the outcome or impact of those decisions. But many real estate, mortgage finance, and legal experts do anticipate that the unprecedented high volume of foreclosures will drop off dramatically as lenders double check their paperwork. Especially following those landmark cases in Massachusetts, mortgage companies want to ensure that they are not breaking the law or risking an expensive lawsuit from a wronged investor or homeowner..
What that means in practical terms for LGBT buyers and sellers is a return to normalcy. While there will still be foreclosures, calming down the frantic pace of processing them will help prevent the rapidly plummeting prices seen over the past 2-3 years. In lieu of these developments, LGBT buyers may want to avoid the foreclosure market for the time being, as volatile legal issues get resolved. Meanwhile LGBT home sellers can expect more price support and fewer unexpected negative surprises in the market. That will enhance home values – or at least hold them steady so that they don’t continue a precipitous decline..
The Overall Real Estate Climate.
Economist Christopher Thornberg – who was one of the only experts to accurately predict the real estate crash – was recently quoted in the Los Angeles Times. He summed up today’s real estate market rather well when he said, “Prices went from stupid-high levels to levels that made sense again.” .
LGBT consumers should not expect the real estate market to come roaring back in Roaring 20s style. Those days of ridiculous price inflation and constant flipping of houses for higher profits – supported by toxic assets and predatory lending practices – are gone for good. But by the same token they should trust that the worst is over and real estate is not a scary place to invest for those who use common sense. .
Interest rates are dirt cheap. The selection of homes for sale is excellent. Prices are reasonable, and housing is affordable. So 2011 should be a great year for buying and a much better year for selling – with an optimistic outlook that will continue to improve as the overall economy strengthens..