Happy New Year, KCM Community! In some ways, 2010 was a very difficult year for sellers, buyers and real estate professionals. However, it made us a little stronger .. as adversity always does. It also helped us remember that the value of homeownership is so much more than just the price of a house. Let’s make 2011 a year to remember… [...]
We have run this post before but want to make sure you still are asking the right questions of your loan officer. Here is a great list from Dean. - The KCM Crew More and more, consumers are learning that there is much more to getting a mortgage than just the interest rate and points. A good mortgage planner is more in [...]
For almost a decade now, every time we talked about real estate we immediately discussed money. We didn't talk about the value of a home but instead about the price of the house. We didn't worry about a roof over our heads but instead the ceiling on our interest rate. We didn't care as much about where we raised our family as we cared about how much we increased our family's net worth.
That will change in 2011. The KCM Crew believes very strongly that real estate will return to what it has been for the 200+ year history of this country: a place for us and our families to live comfortably. It will also prove to be a great long term investment as it always has been.
Our parents and our grandparents didn't buy their homes as a short term financial investment. They bought it so they had a place of their own to come home to at the end of the day; a place to raise their family; a place they could feel safe.
This past year has been very challenging for real estate. The market was defined by outside intervention. This intervention tugged at historic trends. Government involvment caused market fundamentals to be distorted beyond recognition. Unpredictability was the only thing we could predict.
The administration’s announced goal of the modification program was to save 3-4 million families from losing their homes. The actual number of homeowners assisted will come in at less than one million. Most consider the program a failure.
However, we believe that there was a secondary unannounced goal of the modification program: to slow the flow of foreclosed homes to the market. Putting homes through the modification process prevented banks from moving forward with the repossession process as quickly as they normally would.
Trying to negotiate the current housing market is difficult. There are so many external variables impacting real estate it seems almost impossible to project where sales and prices are headed. But, there were two people who saw the challenges we are currently experiencing back in 2005-2006. They looked at the market and predicted we were in for the collapse that occurred. Who are these men? How do they see real estate today? What are they doing to take advantage of the current market?
Nouriel Roubini is a teacher at New York University. He warned that borrowers defaulting on their mortgage loans would unleash a housing bust and deep recession.
According to the Wall Street Journal Roubini is:
...the New York economist whose warnings of a housing collapse earned him the nickname "Dr. Doom" … Ever since much of his dire forecasting came true, Mr. Roubini has become one of the world's most recognizable economists. He has been in demand as a speaker and consultant, often shuttling around the globe to advise central bankers and finance ministers.