Even as home prices keep falling and in large parts of the state unemployment is rising, investors are arriving to buy lower priced foreclosed homes and homes on short sales (worth less than their mortgages). Why? Becaise they can turn them into rentals and get a much better return on their money than if they left in bank accounts that pay near zero in interest.
And unfortunately with so many people having lost their homes, and unable for now to qualify to buy homes again, there is demand for rental housing. Even legendary investor Warren Buffet told CNBC, "Single-family homes are cheap now. If I had a way of buying a couple hundred thousand single-family homes and had a way of managing (them) ... I would load up on them."
If you are considering buying a home and can qualify for a mortgage, please consult your local real estate professional and buy only if you can afford to stay for an extended period of time, for prices are likely to stay weak, as there is a mountain of foreclosures still to be absorbed when Fannie, Freddie and the big banks put them on the market. But as a buyer, you will receive some of the best sale pricing in the last 12 years and a 30 year mortgage interest rate in the 4% range.
Dick
For more information, please see http://www.latimes.com/business/realestate/la-fi-home-sales-20120315,0,4013828.story
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