Is it a great time to buy property ? Yes! Is it simple right now? Noooooooo!
Prices are near or at the bottom of the cycle and interest rates are near historic lows. That sounds attractive, and it is. However, buyers must be focused, patient and ready to ride a roller-coaster of emotions, especially if dealing at the lower price ranges.
Does a short sale listed at $ 199,000 mean that you can make a nice offer of $ 195,000 with an FHA loan with 3.5% down and stand a good chance of getting it. Absolutely not!
What are the possible scenarios?
1) It is likely, if the house is nice, that there will be multiple offers well over list price within days of it going on the market.
2) Many of those offers will involve 10% or 20% down, and there may even be multiple all-cash offers.
3) Even if you offer $230,000 and are the highest offer, you may not get it as the seller is suspicious of the lending market and will take an all cash offer for less money.
4) Even if you are chosen as the offer to send to the bank for approval, it may take the bank as long as 3 to 4 months to give that approval, and they may still attach conditions at that point. In the meantime you are in limbo.
5) Even if you are the best offer, the State and the Feds are pressuring the banks to modify loans, and you may find that, suddenly, the owner of the house is made a good loan modification offer and the house is no longer for sale at all.
It is a great time to buy! The process may well challenge your sanity. So, be prepared for that process and you can be a winner.
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