Question: Is there a housing crash coming?
Don’t be fooled by what is around the corner, folks. There ARE going to be a lot of short sales and foreclosures popping up in the feed, but that’s not a housing crash. What you will see happening is due to an ECONOMIC slide, due primarily to Covid shutdowns, but also to people having been paid to stay home and not work. Business have gone belly up because of this cash-strike (my terminology), and so has their income production for past employees. Here’s a good illustration of how, when something seems to be too good to be true, it isn’t.
Remember when there were rental and mortgage payment moratoriums? Well those are over. And NOW we face the music. It has always been a really bad idea to forgo making your rental or mortgage payment, but in some cases, this was unavoidable. I understand that some mortgage companies said they could tack on the payments to the end of the mortgage (I never believed that), and if that is true, then those folks should be fine. But what I hear more often is that the banks will require pretty much instant catch-up on those skipped payments as soon as the homeowner goes back to work. Well we all know how that’s going to work, if it’s true. People were hurt financially by the shutdowns but the banks…well, they’re gonna want to get paid.
A short sale is a mortgage holder allowing the homeowner to sell their home for less than they owe on it, and those are just around the corner. You can smell them. Certain conditions have to be met in order to qualify for short sale status, and just know that in the PAST, you paid taxes on the amount that wasn’t covered by the short sale, as though that was actual income to you for that year. It was a bad time for a lot of people.
People walked away from million dollar homes in the 2008 crash; but this isn’t that. THIS one is going to be a true accounting of how many people were financially injured by the shutdowns, and I have no doubt that it will be shocking. It will be a sad thing to watch, to say the LEAST. But know, when it comes, it’s not a housing crash. And then, I implore you, sit down, be quiet and THINK about what brought this on. If you keep asking “why?” at the end of each conclusion point, you’ll be taken back to one place.
Remember that there is still a housing shortage, there are still people clamoring to buy, and the real estate market is not crashing, has not crashed. So don’t panic, and remember, if you think you could be heading to short sale territory, PLEASE talk to a financial advisor to find out how you can avoid that place. It’s tough to recover from a short sale or foreclosure. There could be a better way. Don’t give up without investigating.
For those of you thinking of making a good deal during this next crisis, remember your gain is a direct correlation to someone’s great loss. I’m dreading this. I don’t like to see people in pain. But I am a short sale and foreclosure specialist, and I can help with your listing. But first I’m going to try to help you find a way not to go there. That is a promise.
Listen, if you think you’re teetering on that edge, give me a call and let’s try to do some good old fashioned problem solving.
I’m Brenda Briggs, realtor/broker, Coldwell Banker Advantage 919-210-6113