Real Estate

Is now the time to purchase Real Estate?

Record foreclosures and falling residential home prices have caused a serious problem in the real estate market, as well as the overall economy. Economists are already predicting total losses in excess of $200 Billion.

Borrowers who took out loans in the first six months of this year are already falling behind at a faster pace than those from 2006. Forecasts indicate that the amount of foreclosures will triple by 2009.

Federal Reserve Chairman Ben Bernanke warns of higher inflation and lower growth rates.

As analyst and investors shun this market, those who have the finances can buy at levels not seen for many years.

In my area of the USA, it is unthinkable and not probable that prices on single family homes can get any lower. My husband and I just purchased a 2 bedroom home, with a brand new furnace and electric water heater for $11,000. It needed a lot of cleaning and about $2,000 in cosmetic work (painting the walls, new curtains, etc....). I am certain we could sell this home for twice our investment immediately.

I have family in Detroit and they tell me that homes are selling for $5,000 on a regular basis. Not run-down shacks either. Homes that have been abandoned due to foreclosures. People just getting up and leaving.

I am not enthusiastic about investors going into debt for investments. I advocate paying in full if you are capable of doing so. You will find your bargaining power is much stronger if you are willing to pay cash. If not, I recommend waiting until you can afford to put a 25% down payment on the real estate you wish to acquire.

The current subprime crisis is a direct result of individuals taking on more debt than they can handle.

I don't mean to sound smug, because most of my adult life, my husband and I were fortunate to make our mortgage payment and put food on the table for our family. But I stand strongly by my belief that investing in real estate should be done with cash.

A home for your family is a different situation. That is a necessity.

If you are in a position to invest in real estate now, research your local market and make an informed decision.

When will you ever find a home this inexpensive again?

Single Family Homes

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