Remember the original idea of owning a home? It was the American Dream and a privilege to own the home you and your family lived in. It was not an easy achievement but there were many reasons to own a home. You do not pay rent, you avoid unplanned rent increases, have control on whether you need to move, how you want to improve the home and it is a tax incentive with the interest and property tax deduction.  However, with the historical and cyclical escalating real estate market such as we had in the early 2000’s it became an investment, much like the stock market. It became so easy to be approved for loans and if you sold your investment in time you made money. If not, you may be in the same situation as so many people that I am working with right now. The percentage decrease in the market was not something that was planned by lenders or homeowners and almost EVERY real estate homeowner has been affected one way or another.

What I have seen though, is a return to the original principles where lenders are qualifying borrowers very strictly with full documentation and requiring a substantial amount of down payment.  It is once again a privilege to own a home because it is more difficult to qualify but at the same time it is more affordable as the sales prices AND interest rates have come down to a lower monthly payment. Once again, it may be time to buy that starter home because it is less expensive than renting…back to basics. Buy a home, build up value and move up. Remember, you don’t buy your dream home the first time out-you build up to it. So the cycle begins…..again….

- Marilyn

This entry was posted on Monday, June 8th, 2009 at 8:49 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.