Los Angeles, CA (PRWEB) April 15, 2009
The current economic woes have shaken heads of corporations, stay at home moms and blue collar workers alike.
Zillow.com, a real estate Web site, revealed that with foreclosures soaring, nearly 20% of the nation's home sales in 2008 were of bank-repossessed properties. Another 11% were short sales, in which homeowners owed more in mortgage debt than their homes were worth.
In effort to slow the rate of foreclosures the Obama administration has established clear guidelines for the entire mortgage industry that will encourage lenders to modify mortgages on primary residences. The median sales price fell 18 percent from February 2008, the biggest year-on-year drop since records began in 1964. Expert Barrington Malcolm of http://www.iownrealestate.com says, "This is the time to buy real estate while rates and prices are down. Housing Could Drop Another 20% in Pricing."
As of February 2009 there were 60,000 new homes listed for sale in the major cites of these three states alone; California, Chicago and New York. Excess supply of anything means lower and continuously falling prices, and that has certainly been the case in housing. If nothing is done to eliminate surplus housing, prices could fall another 20% between now and the end of 2010.
This is not inconsistent with similar projections by other acknowledged experts such as Barrington Malcolm a Los Angeles, California real estate investor. Barrington says, "If every American with means would buy a home to live in or as an investment it would help to reduce the surplus of real estate that's currently on the market. Over time this will increase the demand and stabilize the housing market. If nothing happens to stimulate buying, there is a great deal more pain ahead for American homeowners."