The mortgage crisis maybe far from over, but Americans still want to be a proud homeowner. In spite the mortgage meltdown, signs are surfacing and they tell that now may be a good chance for investors and homebuyers.
But first and foremost, the root of this mortgage mayhem.
Homeownership was once touted as the blessing that promised prosperity, self-determination, and liberty. But since then, getting into homeownership became the least freeing thing; it became a prison that still holds almost 11 million Americans captive.
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The recipe for this disaster? Ground low interest rates, discourtesy of Federal Reserve blunders and the manipulation of Chinese currency, gave way to a housing boom, the supreme real estate bubble, and then the disagreement.
But the good news is that’s old news. Pershing Square Capital’s fund operator and value investor Bill Ackman, who, through shorting housing-related bond insurer Municipal Bond Insurance Association in the end times of the housing boom, is demanding its resurgence.
According to the latest Fannie Mae survey, 66% of Americans still thinks that purchasing a home is a worthy investment. It is significantly lower compared to the 83% back in the boom days. The Conference Board also reported that the number of consumers looking to purchase a home in 6 months dropped to 1.7% last November from 2.2% prior.
So, is it a good time yet to purchase a house?
Economic data coming in do not attest to it, since the momentary increase from the tax credit of the homebuyers dies away. Prices of homes are dropping and so are the sales. It is a chore to get a loan and there’s hardly any construction activity going on. And today, mortgage rates are the only ones that go upward as the bond market prices in higher inflation and more solid growth in the economy.
This is a message that still rings a bell on people’s heads. Despite the entire dilemma surrounding the housing market, most Americans still go for homeownership.
The improvement of the economy and the creation of jobs will help on the resurrection of the housing market.
Why now is the time to buy?
- Prices of homes are by far the lowest in a generation.
- Fuss-free negotiating with forced sellers.
- Affordable financing
If you are a firm believer of the housing rebound, you know that the most apparent way to profit from it is purchase a home. Specifically if rates of interest soar, anxious buyers and low down rates spells atypical purchasing opportunity.