Should you rent a house if it doesn’t sell?

Anyone who reads this blog, knows that my answer to this question is going to be that every situation is different and you should explore all the options with your Realtor and your financial advisor before deciding something as important as this.

Having said that, there are some generic arguments in support of both sides of the issue.

THIS ARTICLE from the Sarasota Herald-Tribune does a good job of presenting the pros and cons.

This is the Moment for 1st Time Home Buyers

One of the challenges that faces people who are trying to do what we call a “sell/buy” is that selling your home in a buyer’s market (which is where we are right now) often means that the seller will often have to sell his home for less than it was worth a year or two ago. In some cases the seller will actually have to sell his home for less than he paid for it, depending on how long ago it was purchased.

While, in reality, the lower sale price will often be offset by the lower purchase price on the new home, there is great resistance on the part of many home owners to sell for less than they paid.

If you are buying a home for the first time - this market may the perfect time for you to get into a home. The house you want to buy is almost certainly going to sell for less than it would have if you bought it last year or the year before.

There’s no way of knowing if we’re at the bottom of the market yet, so you should be prepared for the possibility that if you buy today your home may actually go down further in value before it goes up.

Everyone’s individual situation is unique, so you should work out the specifics with your Realtor and Lender before making any decisions but if you’ve been holding off on buying your first home this could be the moment.

8 Tips for Pricing Your Home in a Buyer’s Market

Dana Dratch, Bankrate.com wrote on MSN Real Estate, 3/9/08

Getting ready to sell? The more you know about conditions in your local market, the better your chances of getting the best possible price for your home.

It’s tough being the seller in a buyer’s market. But you can improve your odds with the right research.

In many cases, making a smart deal and getting the best price come down to studying your market and being an educated seller.

“You’ve got to know more than you would have if you’d sold a year ago,” says William Poorvu, professor emeritus at Harvard Business School and author of the upcoming book “Creating and Growing Real Estate Wealth.” “If you want to protect yourself, you have to become knowledgeable.”

Click HERE to read the rest of the article

Banks urged to help avert foreclosures

Federal Reserve Chairman Ben S. Bernanke, battling the worst housing recession in a quarter century, urged lenders to forgive portions of mortgages held by homeowners at risk of defaulting.

“Efforts by both government and private-sector entities to reduce unnecessary foreclosures are helping, but more can, and should, be done,” Bernanke said in a speech to bankers on Tuesday at the Orlando World Center Marriott Resort. “Principal reductions that restore some equity for the homeowner may be a relatively more effective means of avoiding delinquency and foreclosure.”

Bernanke’s call goes beyond the stance of the Bush administration and previous Fed comments, indicating that he sees housing as a serious threat to the economy that can’t be addressed by fiscal or monetary policy alone. The Fed’s Feb. 27 report to Congress called for lenders to “pursue prudent loan workouts” through means such as modifying mortgage terms and deferring payments.
Orlando Sun-Sentinel 3/8/08

click here to read the entire article

Governor Rell Warns about foreclosure rescue scams

With a report today announcing that home foreclosures across the nation soared to an all-time high in the final quarter of last year, Governor M. Jodi Rell offered advice to help homeowners avoid becoming the targets of foreclosure rescue scams.

 

“The first thing you should do if you are having trouble paying your mortgage is to call your lender,” Governor Rell said. “Don’t be fooled by companies that offer to work with your lender on your behalf. These companies do not offer to do anything that you cannot do yourself – and they charge for their services.

 

“These so-called ‘foreclosure prevention specialists’ usually charge hefty fees in exchange for making a few phone calls or completing some paperwork that a homeowner could easily do for himself. To make matters worse, none of the actions result in saving the home.”

CLICK HERE TO READ MORE