Los Angeles, CA (PRWEB) August 2, 2007
The recent closure of sub-prime mortgage companies and the escalating rate of foreclosure filings, has forced lenders to tighten up on lending standards. This toughening of lending standards has reaped havoc on the real estate industry, but has created the best buyer's market in decades. Lenders are now extending credit to only the most credit worthy borrowers, which reduces the pool of buyers and gives the qualified buyer the total upper hand when negotiating the purchase of a new or existing home.
All of the recent media hype about lender woes and declining property values only serves to secure the qualified buyer's place in the driver's seat. A well-qualified buyer is generally defined as a person with a 10%-20% down payment and a FICO score above 720.
New home builders are an excellent place for buyers to start their home search. Builders are struggling to move existing inventory (homes that are built but not sold), so they are loading up on the giveaways. Builders are offering incentives such as, granite countertops, top-of the-line stainless steal kitchen appliances, tile flooring, back yard landscaping and many more goodies. In this long awaited buyer's market a savvy buyer can even negotiate with the builder to reduce the price and pay all of the third party costs associated with the sale.
Sellers are also "giving away the farm" to induce buyers into purchasing their properties. Motivated sellers are reducing prices, offering to pay closing costs, giving away luxury cars and vacations. There have even been some unconfirmed reports of sellers offering up their first born children! (Ok, I'm kidding about the first born children thing, but you get the point.)
Even the National Association of Realtors has acknowledged that the market has been transformed into a buyer's market and is urging buyers to take heed. Lawrence Yun, senior economist for the NAR in a July 11, 2007 press release states, "Buyers now have an overwhelming advantage given the wide selection of homes available in many markets... Buyers who make the commitment now are likely to be smiling this time next year."
So, for the buyer who has been sitting on the fence this is the market you've been waiting for. It's time to make like Humpty-Dumpty, fall off the wall (or the fence) and cash in on the best real estate market for buyers in decades.