We have been doing research lately on the state of things currently and more importantly what the experts feel the future holds.
According to several sources, There are several barriers we need to overcome before things improve dramatically. However 2 of these are directly related to real estate, so we will discuss them here.
1.) Real Estate is still in a mess. Why? Even though home sales are up, the market is still being dragged down by distressed properties. Foreclosures will still happen at higher than historical levels. Appraisals are still be made in a climate of fear and banks will still be stalemates over short sales and loan modifications. Until we can get prices stabilized and begin the process of rebuilding household wealth, consumers will still be reluctant to spend. In the Huntersville NC area, I can't emphasize enough the need to now get an appraisal if you are thinking of selling. They(appraisals) are having such an impact in our Huntersville NC area market, that you can stave off potential future surprises and stress by doing so.
2.) Inflation is a real possibility. I don't begin to claim to be a financial expert and understand the intricacies of our economy. However, I do understand this. With all the liquidity in the system and with the majority of the fiscal stimulus coming on line in 2010 that there is a real possibility that we will see a jump in inflation next year. The FED need to neutralize the spending power it has created by pumping TART money into the economy.
How will inflation affect us. One way the FED deals with this is to increase interest rates. Potentially these increases could be significant.
However being a glass half full type of person, I believe that the FED can keep inflation at a minimum as we recover.
What does this mean to us. If you are thinking of buying. Don't wait for any reason. If you are waiting for the tax credit to be extended, I hope your wait is worth it. If interest rates start to increase in 2010,it could negate or devalue the tax credit. There is too much inventory and good deals now to wait this out.
Up until recently, I have been telling my Huntersville NC area seller clients to wait to sell. However, with what is potentially on the horizon, we should sit down an analyze every factor before deciding.
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