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kenl314

Those of you "thinking of getting a mortgage" are most likely also looking for a house right now. As such, you're very interested in the current housing down market or "buyer's market"- and all that relates to it within the mortgage field. This is just a primer, and some opinion thrown in there.

Fair to say that 2007 is now and will be somewhat of a mess, and also a buyer's market. Note that all real estate is local, so your region or state may be very different from the next region. Also note that a buyer's market is only really good if you're a first time buyer. For the 90% of homeowners that are looking for another house to move, a buyer's market really doesn't help them out any. You still have to sell your existing house in a down market.

It's estimated that home prices will stay flat or decline another 1% or so nationally during 2007. It'll be 2008 before prices start going the other way again.

One large X-factor is how many foreclosures they'll be in 2007. Experts are saying the foreclosure rate is increasing, and will throughout this year. Banks don't want to own houses, so they usually sell them off for under market value. What does this do? It artificially deflates the local home prices- including your house.
Most of these foreclosures are from either subprime loans AND/OR interest only or "payment-option" loans. People are getting in way over their head with these payments once the rates reset (many are resetting this year).

For more information, and much more about the exotic, interest-only mortgage problems, please check out my Blog below. Thanks,
Ken L.

miller_st · Joined: 17 Jan 2007 Posts: 918 168.95 Dollars($)

Very good information Ken on home prices. People should only take on IO or Option ARM when they know all the advantages and caveats of such loans. Otherwise most likely they will face foreclosure down the line.

Miller

jameshogg · Posted: Fri Mar 16, 2007 12:43 am Post subject: RE: 2007 housing market scenario

yes Ken, the housing market had shown a decline initially. But slowly and gradually it has started to stabilize as I have heard.

The foreclosure rate is high no doubt in several states across the US. And it's a fact that exotic mortgages are getting popular especially the Option ARMs and interest-only loans. Most people are going for such loan options to cope up with rising home prices or to buy bigger homes.

James

Guest

hi Ken,

I visited your blog recently and interesting product - your AMF. Your are correct - the subprime market has been going through large number of foreclosure cases. Lawmakers are also very concerned about the rise of foreclosures in such huge numbers.

i read a new story yesterday here the community News section, where they have said that the foreclosure is the highest nowadays over the past 40 years especially on FHA loans.

Let's just hope that things shape up well both for borrowers and industry people.

Guest

kenl314, I liked your blog, lot of info their Smile

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Lowdown on 2007 Housing & Mortgage markets-