Real Estate market is stuck in neutral
Sales are at the highest point of 2014 burr still below last year. NAR says it’s because of the lack of inventory. Builders are not building enough new homes to satisfy the demand. According to the NAR we need 14 million new homes and less than 10 million are being built. But it looks like the builders have a reason to be cautious.
The buyers for these homes tend to be move up buyers. In order for them to do this, there has to be the market for people to buy their homes. This is where the problem lies. First time homebuyers are absent. From the market. 32% of 18-34 year olds are still living at home or with their friends.
We need income growth and relaxing of overly strict mortgage rules for this to happen. The Dodd Frank act is suppressing lenders from giving loans to normal people. Even Ben Bernanke was turned down for a refi because he had not been at his present job for 2 years. In case you don’t know, his past job was head of the Federal Reserve.
This absurd Dodd Frank rule is also working against investors and anyone who wants to do owner financing. Our upcoming Dec meeting will feature a company that will help you to do owner finance and still be in compliance of that rule.