Top 10 Things to Expect in the Housing Market in 2009
After the too-good-to-be-true housing boom in the first half
of this decade, 2008 was a dose of reality. The subprime
mortgage crisis and the collapse of major financial
institutions made this year a tough one for real estate.
Expect 2009 to be filled with more change and adjustment in
home values and expectations. On a positive note, help is on
the way from the Feds, and some experts say a slow recovery
could begin in late 2009. Prepare yourself for the
challenges -- and opportunities -- of 2009 by getting
familiar with what to expect in the housing market.
1.
Continued market adjustments.
With home prices in some markets having reached astronomical
levels, it was inevitable a reset button be pushed. Sellers
will continue to be challenged in 2009 as the inflated
pricing of years past adjusts to normal levels. With banks
and builders willing to slash prices to sell a backlog of
foreclosures and new homes, individual sellers will have to
price their homes competitively.
2.
Action from the Obama administration.
President-elect Barack Obama's plan to help the housing
sector includes a 10 percent mortgage tax credit for
homeowners who don't itemize their taxes and a crackdown on
abusive lending practices.
3.
More assistance programs for homeowners in danger of
foreclosure.
While the federal government is attempting to reduce
foreclosures, a report released by the Joint Economic
Committee predicts 2 million foreclosures in 2009.
Homeowners who are at risk should take steps to avoid
foreclosure.
4.
Some calm to the chaos of the banks' restructuring.
This should cause loan modifications and short sales to get
easier, and it will also (eventually) decrease the number of
bank-owned properties on the market.
5.
Thorough reviews of mortgage applications.
Before the subprime mortgage debacle, you didn't have to
prove you could afford to borrow $200,000 for a home and you
didn't need a down payment. Those days of sketchy lending
practices are gone. Lenders now require potential borrowers
to provide extensive income and expense documentation.
Homebuyers with the best credit will get the lowest interest
rates. Take steps now to get your finances in order and
boost your credit score.
6.
Low prices and low interest rates.
2009 could be the time for reluctant homebuyers to act, as
this is perhaps the last year of the best buying opportunity
in recorded economic history.
7.
Cool tech tricks and tools for the real estate obsessed.
As homebuyers turn to the Web more and more for their real
estate needs, video, webcasts and mobile search tools are
becoming more prevalent. Sellers should consider using these
cutting-edge tools to make their homes stand out.
8.
Wiser consumers.
After facing this foreclosure crisis, buyers, sellers, real
estate agents and even tenants will have a deeper
understanding of real estate, mortgage and credit, which
they can use to make better decisions and be more
self-protective in the future.
9.
Leaner, greener home buying.
Across the board, home buying is becoming more eco-friendly,
from transactions being conducted digitally to buyers opting
for smaller homes within walking distance of school and
work.
10.
An increase in consumer confidence.
As the year goes
on and we near the projected end of the recession, sellers
can breathe a sigh of relief as buyers regain confidence in
the market.
