Home prices have recently risen by double digits in several Western states, and especially so in California.
People in the South are slightly less optimistic, where 54% said it’s a good time to buy.
Midwestern folks seem to agree with 53% home values are rising.
Skepticism runs higher in the East where only 44% expect an increase in values.
Home owners are more optimistic than renters. Of all Americans who own a home, a big majority at 81% expect real estate prices to increase. On the other hand, only 44% of renters expect prices to increase.
Perhaps there’s a marketing clue there for real estate agents and mortgage lenders. Current home owners are feeling more urgency to sell and move up before prices continue upward than are renters.
And speaking of pessimism among renters, those who would have eagerly sought loan approval in the past are now of the mindset that they won’t qualify. A surprising 56% of renters said in a national consumer survey that fear of rejection is holding them back for applying for a home loan. The two biggest concerns are credit and income qualifications.
Good News for Home Buyers
It comes as a surprise to some that perfect credit is not required. Not all lenders have the same requirements. If you fear that your bank is too strict, call a local mortgage broker. Brokers, somewhat like travel agents, have access to multiple wholesale lenders. A mortgage broker will do the shopping for you. Brokers know which lenders will go down to a 620, or even lower, credit score for an FHA loan. And the good news is that a mortgage broker does not necessarily cost any more than a bank. Nowadays, many small and midsize lenders are both brokers and direct lenders (with their own money). This gives them greater flexibility and gives you a greater chance of approval than going to a bank or credit union that has only their own money and strict guidelines to offer.
Something to Think About: How You and I Control House Prices
When people think the economy is improving, they are more willing to spend money; therefore, their mindset actually improves the economy. The same goes for the housing market. If people think values are going up, they want to buy now before their desired home costs more. When more people are selling and buying, the housing market improves and values increase. So even if you don’t think real estate is increasing in value, if your neighbors believe it is, their attitudes and actions can make that happen.
That would make them right then, wouldn’t it? Hmmmm, something to think about.