I read an interesting article in The Washington Post today, “Housing Market on the Brink of Recovery, Relapse.” The article not only points out the number of foreclosed-property auctions and the hardest hit areas, it brings me back to a previous blog the end of May. Current trends in the DC Metro market place as a result of low inventory and $8,000 tax credit deadline quickly approaching, buyers are no longer looking … they are buying. Affordable loans with interest rates around 5% give buyers the buying power needed to secure the home they desire in multiple offer situations … leading to increased sale prices.
Short sales and foreclosures tend to lower neighborhood prices, even though the majority of foreclosures are priced at market, the stigma they leave on a neighborhood is not easily recovered. In the months since the foreclosure moratorium ended, lenders have tried modification programs to keep homeowners in their homes where ever possible. However many believe that there are enough looming foreclosures, not as a result of bad loans but employer cutbacks and layoffs, to lower prices once again if the banks flood the market. The question remains, if a large number of foreclosed properties are released into our market during the fall what will the winter bring?
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