MoneyMatters101.com Home
Real Estate Information

20 Real Estate Terms
1031 Tax Exchange
A Home
An Appraisal
Are Homes To Big?
Attention Veterans!
Avoid Fraud
Best Investment
Buying A Home
Buying REOs
Buying Real Estate
Can You Qualify?
Cash vs Home Loan
Clear Title
Climate Change
Closing Costs
Disclosing Material Facts
Distressed Property
Drug Houses
Down Payments
Escrow Information
Escrow Terms
Get Pre-Approved
Fair Housing
First Time Buyer
Foreclosure Guide
Foreclosure Scams
Home Prices
Home Warranties
Home Worth
Housing Statistics
Increase Sale Value
Intentional Default
Interest Rates
Is Now The Time?
Loan Modification
Look For A Bargain
Making An Offer
Market Analysis
Mineral Rights
Overvalued Property
Preparing To Sale
Preparing To Buy
Pricing Your Home
Probate Properties
Property Appraiser
Real Estate
Real Estate Scams
Rental Profits
Revive Market
Security Systems
Sellers Guide
Sell First?
Selling Real Estate
Short Sale I
Short Sale II
Short Sale III
Single Households
Smart-Home Technology
State Agencies
The Housing Crisis I
The Housing Crisis II
You Flinch, You Lose


Email Us


Short Sales




Bargains In The Housing Market

Many first time homebuyers are looking to purchase property at low prices but are finding it hard to get real bargains on homes.

"A bargain is only a bargain if you can afford to pay the bargain price."
~John M. Roberts~

When the housing market went bust, you could pick up homes at bargain prices through short sales, foreclosures, and from people who were willing to accept lower selling prices simply because they wanted to get a quick sale and move on.

If you could afford it, you could get a bargain on a home but most people were not sure if and when the economy would rebound so they were reluctant to buy. So most distressed properties were bought by investors and although there are still foreclosures on the market, there are not nearly as many.

In essence, banks are actually trying to work with property owners to renegotiate mortgages through a government sponsored loan modification process. And like everyone else, banks are cautiously waiting to see what happens with the economy.

It is not that great of a buyers market. Prices are still relatively high and there is still a lot of competition from investors. And just because a home is in foreclose, or is a bank owned property, it doesn't guarantee that you will get a bargain basement price.

  • The reason. There are many people out there who want to buy property, including investors, which means that as a potential buyer, you may get caught in a bidding contest. When there are multiple offers on a home, the price goes up and the property will usually go the the buyer who has the most money, the best credit, and/or the highest income.

A bargain is only a bargain if you can afford to pay the bargain price. In today's housing market, it is not possible for many first time homebuyers to purchase property because, although home prices are still relatively low, they are rising. And there are barriers such as having enough income, credit issues, and the lack of a down payment that makes buying a home a real challenge.

On top of that, many potential homebuyers are also finding it hard to get home loans. This is because many banks are reluctant to loan money, in many cases, even if the buyer is qualified. This means that the banks are not giving loans as willingly as they were a few years ago.

As most of us already know, stated income loans are a thing of the past. Today, you have to prove that you can qualify for a home loan by showing the right amount of income and your credit score must be high enough to satisfy a lender that you are credit worthy and you can handle the monthly payments.

Many would be homebuyers are not making enough money to qualify for homes. Although employment opportunities are increasing, income is not keeping up with inflation which makes it more likely that they will have to wait, buy a smaller home, or buy in a less desirable neighborhood.

Lenders remember what happened that got them in trouble in the first place, most notably the practice of qualifying buyers using stated income and underwriting subprime loans. They are well aware of the negative consequences, plus, banks are being monitored very carefully by federal and state agencies in an effort to prevent bad lending practices from starting again.

In some instances, getting a bargain on a home is great, but not for everyone, especially current home owners. Homes selling at lower prices causes a drop in value of other homes in the neighborhood. Having property values remain steady is in the best interest of just about every homeowner out there. The equity in their homes is more than just money in their pockets. Equity buildup is important to many people who want to move into better neighborhoods, have money for retirement, or, if they have already borrowed the equity, they don't want to owe more on the home than it is worth.

Over the past few years, in cities and towns across the country, home prices have leveled off and in some areas they have risen.

About the author

John M. Roberts is the owner of John Roberts Realty located in Rancho Belago, California. You may contact him at jrobertsrealty@yahoo.com.


Book of the Month

Book about investing

Advertise on MoneyMatters101.com

Ask a Real Estate Lawyer Online

We have partnered with JustAnswer so that you can get an answer ASAP.



Accessibility Policy| Terms Of Use| Privacy Policy| Advertise with Us| Contact Us

Use of this web site constitutes acceptance of the Terms of Use.

We are looking to create more mutually beneficial partnerships. If you are interested in partnering with MoneyMatters101.com, send us your proposal.


Link to MoneyMatters101.com