You (Yes You) Can Help End the Real Estate “Recession”

First of all, I hate using the word “recession”.  Technically, I suppose it is, but, in my mind this is more of a correction.  Real estate was never meant as a “get rich quick” investment…  but it happened.  Now that’s being corrected.

 

Anyways, with that out of the way, here are several easy tips you can follow to survive the current real estate market.

 

1. Don’t sell your properties!  One of the problems we have currently is that there are too many properties on the market.  We need the current market to only consist of serious and/or desperate sellers.  Those who are simply looking to make themselves more comfortable by buying a slightly bigger place, or move 10 minutes closer to work need to pull their listings off the market and get comfy for a year.  If you truly do not NEED to sell, and you list your property anyways, you’re really doing yourself a disservice for a couple reasons:  1 – You won’t get as much money for your property now as you probably will in the next year or so.  2 – Unless you’re priced to sell in this market, your property will (most likely) linger, causing people to think that there may be something wrong with it.
   
2. Buyers be confident!  As I’ve said in past blogs, the adage is, “Buy low, sell high!”  With so many sellers competing for sales, now is a great time for “buying low.”  As real estate is typically meant for a long term investment, when, and for how much, you buy will dictate how much money you make in the end.  Therefore, with prices relatively low now, if you wait for higher appreciation rates, you’ll wind up losing money in the long run.
   
3. Settle your finances!  This is not the time for a 100% LTV, interest only, stated income loan (in hindsight, it never really a good idea).  If you’re in a high-risk type of loan, refinance your property!  You don’t want to be the next statistic quoted in some over-publicized report.   If it looks like you may be in trouble moving forward, start talking to your lender, attorney, etc., early and often to see what, if anything, can be done (rent it, refinance it, sell it if you have to…). 
   
4. If you are a buyer, put together a good down payment, mind your credit, and make yourself the most solid buyer you can be!  Why waste loan origination and processing fees, legal fees, and inspection fees, only to find out that one erroneous late payment is about to blow the whole deal?  Analyze the market carefully, use your resources (Realtors, attorneys, financial planners, etc.), and make a smart, well thought out decision.   

When the market flipped from being laden with buyers and short on available properties to long on properties and short on ready, willing, and able buyers, many people lost their minds.  Though congress will claim to have fixed the problem when it corrects, it will most likely be corrected through common sense and good planning.  I apologize if that seems like a dull answer, but it’s what I believe. 

 

When people were not thinking straight, or not thinking at all, it seemed like a good idea to buy the dark, cramped condo in the “hot” new development, because people were making money off of anything and everything real estate.  Now, with the tables turned, there is no demand for that same dark, cramped condo unless the price truly makes it a value.

 

Are you going to save the market yourself?  No.  But, with good planning and good advice, we will survive this correction, and return to a “normal” market soon.

Tags: Buying Real Estate, foreclosures, market correction, Real Estate Advice, real estate appreciation, real estate investing, real estate market conditions, recession, selling real estate, short sales