Are we there yet?

Is this a good time to snap up property bargains?

Can you sell your house in nine days, and should you?

When does the market hit bottom? When is a good time to sell? Should you wait or do it now?

I sold my real estate in 2005 so I am a happy renter. I continually assess the market as part of my work in the Mortgage Relief Formula helping hundreds of homeowners.

But I have some bad news if you are expecting the bottom of the market any time soon. And here is why. This comes from an outstanding newsletter ContraryInvestor.com that I highly recommend.

You see a huge number of refis done from 2004 to the end of 2007. These are adjustable rate loans. Many if not most are option ARMs and other loans that must be refinanced.

Yet, refinance volume is not high. As this chart shows:

See that little spike? It's tiny compared to previous refi volume.

So why aren't all those adjustable rate option ARM homeowners refinancing?

Because they have negative equity.

Millions of people have negative equity. They owe more than their house is worth.

And lenders and homeowners are sitting on millions of houses that they are waiting to sell.

Are you sitting on your house? Should you be doing that, expecting things to get better in late spring, or perhaps 2009?

Well, here is news for you then.

The banks we deal with in doing mortgage short sales are unwilling to take a lot of deals because the buyers are investors. The banks end up taking back many properties in a mortgage short sale and then sitting on those properties. There is a vast number of properties that are going to be offered this year, 2008, at some point. And when they are, you are going to see property values fall much further.

The conspiracy amongst lenders and regulators

Normally, when a bank or institution like Freddie Mac or Fannie Mae has bad loans, the regulators come in and order them to get rid of those loans. Not this time around. As Brian Pretti has noted:

there is a literal tsunami of residential real estate destined to hit the markets at some point probably in the not too distant future.  Real estate that is being held back in some misplaced notion of obtaining current loan value on the sale of the property in current foreclosure…some type of current artificial restraint playing out in foreclosed homes not being sold to the highest bidder at market, but rather being held back in the "hope" of recovering loan amounts still outstanding.  Hope with just about zero chance of even approaching reality.  All of this being implicitly allowed to occur by the bank examiners winking over there in the corner.

I get numerous calls from real estate agents and short sale experts asking me why the banks won't accept perfectly reasonable short sale offers. My answer is that they are waiting and hoping. I have seen exactly the same thing as Mr. Pretti remarks on. And I think it is a matter of time, and soon, when the banks start accepting realistic (ever lower) offers and prices plunge anew.

The only way this doesn't happen is for the banks to simply own more, and more, and more real estate. The federal government could print money and prop up the banks. And I suppose they could become federal housing projects. But more likely, in any event, is a cascade of defaults and bank insolvencies leading to vast amounts of residential real estate hitting the market.

So is it the bottom yet? Unfortunately, not by a longshot.

Should you sell your house in nine days now?

Fact is, you can sell your house in nine days in almost every area. And you should. Because things are getting much worse. Even if you can't sell in nine days, you can sell very quickly.

Price your house low. Get people competing to make you offers (yes you can do that even in really distressed areas if you know how.)

And accept the first realistic offer that comes along even if you "need to get" more.

If you want to get out from under your situation, I urge you to do a mortgage short sale now. I can help you sell your property today and get out of debt through my information. Watch this important video on short sales and keeping good credit, getting released from liability and moving on with your life.

See walking away from your mortgage for more information.  And also see should you stop making your mortgage payments. And how to sell your house fast.

And please watch my video on how to avoid foreclosure by doing a short sale even if you have a second mortgage foreclosure situation. The answers are here. I will never share your name or email with anyone.

And watch this video on short sales and foreclosures. This is a screen shot — just type in your email and I'll get you to the real video. Thank you.