I have been hearing more and more conversations lately of people struggling with a perception that finding and obtaining financing for real estate purchases is nearly impossible these days. Before giving up hope, I urge you to take the time to research the financing options available to you, despite what others may be saying on their lack of availability.
Financing is available for those who qualify. Qualifying may not be as hard as you have heard either. It is true that guidelines have reverted back to a more conservative level, however if your debt to income ratio fits, than there is plenty of money available to you.
As an example, we just had a successful closing for a bank owned property (REO) in Seaside. The bank arranged financing for this $360,000 purchase using an FHA loan with 3% down. The buyer received a rate of 6.5% and a credit of a half point towards closing costs. The seller also contributed $5000 to the buyer’s closing costs and the guidelines had no reserve requirement.
Presently, conforming and FHA loan limits allow for financing up to $729,750 on a single family residence purchase. Market changes are bringing us back to a place where houses are more affordable, and now is the time to look into your purchasing options.
Financing opportunities do exist and are available for those looking to purchase a home. Consult a REALTOR® today for information on the area you are interested in and to get a referral to a trusted lending source.
Joe Smith
Bratty and Bluhm Real Estate
574 Lighthouse Ave.
Pacific Grove, CA 93950
(831) 372-7700 PHN
(831) 375-7790 FAX
Housing facts and figures for Monterey County
Monterey County home sales for the third quarter of 2008 increased by 42% over the second quarter of 2008. The majority of sales, 70%, occurred in Salinas, South and North County. The remaining 30% of sales occurred on the Peninsula, with the majority in Seaside and Marina. Of the 941 home sales of single family residences (as reported by MLSListings) foreclosures accounted for 76% of the total sales.
Real estate is experiencing a very non-traditional market atmosphere. The majority of property is bank owned with asset managers hired to facilitate the sale. They in turn hire real estate agents to list those properties. The listing agents are asked to perform a multitude of tasks that wouldn’t be required on a traditional listing. Banks also take longer in the negotiation process with the buyers. Consequently, if a buyer is looking at a bank owned property (also known as an REO) selecting a REALTOR® to counsel on the dynamics of the transaction and assisting in navigating through the process will make all the difference in securing a successful closing.
The sale price of any real estate is established by what a willing buyer and willing seller agree upon, thus setting the market price for all other properties in a particular area. It is extremely difficult for the ‘traditional’ seller to compete with bank held properties that are priced for quick liquidation. Unless a seller has an urgency to sell, pricing property above the current comparative market price may not be in their best interest. Again, sellers should consult with a real estate professional to ascertain current market conditions.
Attempting to predict where the housing market is headed has become an almost daily guessing game. With average sales prices in the Salinas area between $200,000-$300,000, and Seaside/Marina around $300,000- $400,000, one would wonder if we are at the bottom. Owning a piece of Monterey County real estate is now more attainable than we could have imagined. For many this is a time of opportunity, be it for investment or as a first time home buyer.
Sandy Haney
MCAR CEO
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