Real Estate Author Mark Nash Offers Real Estate Strategies for Softening Market

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Expert states, housing and real estate bubble hype isn't irrational exuberance.

Real estate consumers are the winners in the latest round of real estate bubble headlines. The media's focus offers information and opinion on markets and practices to the individual property owner and investor. Real estate author Mark Nash offers strategies on how to read signs of a softening market.

Warning signs for consumers are:

*Incentives offered by builders on completed new construction buildings or homes; this indicates an over-supply of new units. Research the length of time of property has been on market in a specific location. If the majority of sold properties have sold in thirty days or less in the past ninety days, but the current market times for the majority of sold properties are 60 or more days, the market is softening.

*Inquire of several full-time mid to high producing real estate agents in a specific market what percentage of properties going under contract are receiving multiple offers. If the number of properties are being sold in multiple offers is declining, the market is moving away from being a sellers market.

*Compute the absorption rate of like-kind properties for sale in a specific market. Example: 10 current listings of single-family homes priced $1000,000 to $125,000. Number of comparable homes sold in the last 12 months: 100/ 8.3 sold per month. Number of comparable homes sold in the last 6 months: 50/ 8.3 sold per month. Number of comparable homes sold in the last 3 months: 10/ 3.3 sold per month. Current number of months inventory for comparable current listings: 3.

*Home prices and mortgage rates affect each other, as interest rates fall, buyers can afford to pay higher prices for housing. As rates rise buyers qualify for lower mortgages. Higher interest rates shift consumers spending from home prices to mortgage interest expense. Watch interest rates as an indictor of deflating prices.

*Many individuals missed red flags in their technology investments. Understanding the market signals and timing can mean the difference between profit and loss in today's residential real estate exuberance.

About Mark Nash

Mark Nash is the author of his fourth real estate book "1001 Tips for Buying and Selling a Home" and a real estate broker in Chicago. Mr. Nash's consumer-centric real estate perspective has been featured on CBS The Early Show, Bloomberg TV, Marshall Loeb's Dow Jones Market Watch and Universal Press Syndicate.

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Mark Nash


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Mark Nash
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