Things Are Looking Rosie

THINGS ARE LOOKING ROSY

by Darrin DeRoches February 11 - 17, 2010

The experts believe that in 2010 real estate sales will be up 13.3 per cent from 2009, and over the booming sales of 2007. Not bad seeing we all stopped buying this time last year. Just because our neighbors to the south screwed up their housing market, ours slowed to a crawl last year just to finish off with a bang. Now the experts are calling for a banner year, but others are calling for a “bursting bubble” in the end of 2011. Why? The market is a seller’s market right now since the inventory is low and buyers are paying a little higher due to the glut in the market. Right now I have buyers with 240 grand cash to buy a home in the Locke and Dundurn area in Hamilton and there is nothing suitable to buy. The houses left on the market are either tilting, or dumps. They are willing to pay more, but there are no houses left worth buying and we have been looking for the last six weeks, going out every time something comes on the market. During the last deal in January we secured a house that was expired, and while waiting to do inspections other agents started to look at expired listings and were trying to get in to buy the house; fortunately we closed the deal. I have had discussions with other agents and they are finding the same problem in different areas and price ranges. Hopefully the spring market will bring more homes to the market. If you are thinking of selling, get it out there now: a good property will sell for top dollar. So why are the experts calling for this bubble in 2011? Well it is the damn Americans – again. These subprime mortgages of last year made all the problems and scared the entire world. Obama had to bail out everyone and most of them have paid him back, but the mortgage industry is still receiving funding. Nobody seems to be noticing, but the American government is still and have pledged to continue to bail out the mortgage giants. Hello, is anybody paying attention? The mortgage crisis is not over. All of these subprime mortgages have not gone away. Some have been changed into more conventional types, but a lot of them have just continued on, and a majority of these mortgages will be up for renewal at the end of 2011. Some so–called experts say 90 million subprime mortgages are still out there and will be up for a huge increase that the home owners will not be able to pay. So this is the “bubble”. So things are rosy right now – interest rates are holding still to about June – but the bubble may be burst, or maybe not V [DARRIN DEROCHES] Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at mail@uniquerealty.ca.