It’s no secret that home prices have fallen over the last few years. This downturn in the market has harmed most Americans. However, a select few investors have taken advantage of these low prices by investing in distressed houses. These foreclosed properties are usually sold for a fraction of what they are actually worth, creating an opportunity for people with capital to make a profit. Nonetheless, investors have been forced to use unconventional methods of funding.
The number of homes in California purchased using cash has skyrocketed over the last year. 30.9% of new homes were purchased without a mortgage in 2010. Compared to just 13.9% ten years ago, this is the highest level in at least 24 years, says DataQuick Information Systems.
These figures do not surprise me. After all, qualifying for a mortgage is no easy task. With home prices expected to fall further this year, I predict that the number of cash purchases will continue to increase.
undoubtedly it's getting hard to apply mortgage because banks suffer a large amount of loss during the sub prime period. On the supply side, i have read a article stating that the number of houses built in 2010 is lowest among recent years. therefore, i believe that there would be a upward preesure on the property price. maybe property would still be a good choice for investment purpose.
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