Home Lending Reverts Back To 1980s Standards As Real Estate Industry Suffers Hangover
Let’s face it, the past 10 years has been an aberration and real estate professionals are recovering from the hangover right now. For the longest time, 20 percent down and 15 or 30 year mortgages were the marketplace. Certain people qualified for government programs but that was the exception, not the rule.
Families saved for years for to put together a sufficient down payment to buy a home. Then came the era of loose and cheap lending and nearly anyone could qualify for a loan. Builders built like crazy, renters bought with no money down, and investors bought more than was rational as prices soared.
And now we are in the hangover.
But that okay, really. Sure the volume of homes built will not return to 2005 levels and selling and buying a home is going to take a great deal more work. For such a major investment, and it is an investment, families are probably better off suffering a bit and appreciating the achievement.
But if my memory serves me correctly, there were real estate agents and home transactions in the 1980’s.
And a lot less foreclosures to deal with.
The credit crisis has led lenders to abandon the freewheeling practices that fueled no-money-down mortgages during the past decade and helped fuel the run-up in home prices that peaked in mid-2006.
Compared with the boom years earlier this decade, far fewer buyers are using adjustable-rate mortgages. Lenders generally are requiring much higher down payments, often around 20%. Interest in loans guaranteed by the Federal Housing Administration (FHA) is surging as borrowers accept the government agency’s tight restrictions in return for down payments as low as 3%. via USATODAY.com.
My mom told me to put the statue in the ground, just seems wrong to me but I did it. ...
What about RE/MAX Commercial? Where this classification came from?
I am pretty sure RE/MAX Commercial in volume sales must be above ...
Well Tom, once again you have said it much better than I could have. Unfortunately the folks at Move, ...
It certainly does not bode well for a fast recovery in the economic climate. This will affect all real estate ...
I HAVE 25 YEARS EXPERIENCE IN TELECOMMUNICATIONS..HOW DO I APPLY AT KAI. 
Definitely not a fan of Move Inc.!!! 
A lot of you really need to go back to kindergarten and learn to spell correctly. If you cannot spell ...
In 2008, there was an extension to push first-time home buyers to purchase their homes quickly since the program did ...
I also need HELP and don't know what to do about my problem. I have a garden apartment off ...
I have the same situation. I sold my home in July and am scheduled to to close in a few ...
Comment by T.A. Sayers on 7 November 2008:
I found this post interesting, New Zealand real estate is going through a similar downturn, except that we peaked at the beging of this year and the Real estate machine came to a grinding holt. in the past 6 months we have seen a 25% decrease in the No. of real estate people in the industry and have had large failure rate of offices, Not only has this happened this year but we have also had the real estate laws reworked in New Zealand which I think will create a more difficult enviorment to work in and an increased risk.
If we go by the way the states have gone we could be looking at 3 or more years of decline. This will just be devestating to a former vibrant industry.
Our second mortgage leaders and finance companies have nearly all but gone and the ones that are left have shut up shop. Growth I think will slow as developers find it hard to find the bridging finance. In my city Tauranga (second fast growing city in the country) we have alot of subdivisions on the cards but noones touching them. people are trying to get out and finding it hard to get interest in these properties and what interest there is has been 10-30% below asking price.
I hope and even pray that we will bounce out of this sooner that later. its just hard to see it in the current time.
If you are looking for a Real Estate Professional in Tauranga N.Z. give me an email bayproperty@hotmail.com
Comment by Todd Covington on 16 December 2008:
While I am an optimist, 2009 will be as bad as 2008. I just got into the business and boy it is slow. My guess is spring 2010 is the earliest we will see any type of recovery.