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.
an add on to my previous comment--I suppose nationally it's hard to tell, but each city and market is in ...
I live in the Philippines and I am glad we are not on the lists... 
I have a few Litograghs of Presidents homes , made by Richard V. Sebring. yr. 1990 Do they have any ...
I see the question I have, but no response. I do not have a for sale sign up ...
I'll add mine to the list too. This is happening in Kansas City, Missouri as well now.
We already knew ...
I truly feel that the real estate market will not see a rise or increase until the national economy starts ...
I am currently sitting on an international hedge fund that is investing 100% of an income generating property. Proof ...
Here is one from last week claiming thier son died. Sick.
Good Day,
Please excuse my late reply but I couldn't respond ...
I received the same "Lagos,Nigeria for an international Christian follower’s crusade" email as the post above for a rental place ...
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.