The UK has seen the value of Real Estate fall and credit tightened just as we have experienced here in the U.S. Now the UK is showing signs of the housing market bouncing back; and at a healthy rate.
The UK has seen the value of real estate fall and credit tightened just as we have experienced here in the U.S. Now the UK is showing signs of the housing market bouncing back; and at a healthy rate.¬† So what does this have to do with our market here? We talked about when the market would come back on this side of the pond, truly come back. I still don’t believe we are in a true recovery here. I think we are seeing a false start based on incentives, foreclosures and short sales and we still have a way to go.
But just as in the UK, when buyers think the market has reached its bottom, they will once again start looking at making those real estate investments. The UK is also still experiencing credit problems as we are here. To purchase in the UK it does require a substantial percentage down to get a loan and there are many red tape hoops to jump through, as it is not much different here.
As our prices continue to fall, and they are, we will start seeing more and more buyers and investors looking. I have seen an upswing in “shoppers” kicking tires so to speak, but not many actually going to contract. Our recent real estate report (local), tells the story of just how many buyers are actually taking it to the closing table and that’s still very few.
Will the extension of the tax credit help sales? It can’t hurt, but that is not the answer to our problem. The market is going to have to lose at least forty percent of it’s inflated value, and in some cases and locations as much as 70%, before we begin to see buyers making serious decisions. Everyone has become a “bottom feeder” in this current market.
Aside from being worried about job security and what tomorrow will bring, there are many who would consider buying a home today if they truly believed the price is as low as it can go. I for one believe that we are still searching for bottom, we are near, but not there yet.