US Housing is near the bottom?

Well, I am seeing evidence that we are about ready to be at the bottom. Not everywhere. And not all at once.

But I think we are near the bottom.

In fact, I sold my (last) house at the peak and I will be buying next year.

I will buy with no down payment and without getting a loan. "Subject to" the existing liens. And I will buy with no risk and only upside.

I do not believe housing prices in "Real" (inflation adjusted) terms will be anywhere near their values in 2005, even by 2015 or 2020.

But in terms of US dollars, they will be bottoming out in my neighborhood sometime next year.

Inflation of the worst kind is being baked into the cake by our irresponsible and out of control government. Very large increases in the price of living is resulting. And without the asset inflation people got used to.

I don't think anyone should be in a hurry to buy. Give or take a year, no big difference. The only reason I'm buying next year is cuz my lease is going to be up and it is just easier to buy rather than rent again. And who knows, if things are worse next year then I'll wait and rent something else, with an option to buy.

The way I will buy, I will be at no risk anyway. But I can't see how this thing is going to work out economically without the worst sort of currency depreciation winding its way through the system.

Now, let me debunk another mis-truth.

The banks are lending money to people — just on more difficult terms

Mortgage money is available. And loans are being made. Just for people with better credit. Higher down payments. Better employment histories.

Take a look at this chart, courtesy of my friend Brian at ContraryInvestor.com:

This is all the bank lending. It is still growing, not shrinking! The media are full of lies. They are saying that the banks are "frozen up" and won't lend to each other.

Hogwash!

Fact is, houses are selling. But you have to be careful your buyer has the bucks, the credit, and the employment to close on the deal.

In the old days, say pre 1982, you needed to put 20% down payments down on a house. And you needed good credit. A whole pile of paperwork. Employment verifications done in writing. We are fast returning to that period.

Even the FHA guaranteed loans are heading this way. Not the down payment part, but the difficulty and the stricter underwriting standards.

I am into doing deals where I don't have to put money out of pocket or qualify for a bank loan.

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warmly, 

 

 

P.S. The opportunity here is to put the bad news to work for you. The news can motivate people around you to let you buy their house, or work out a loan mod for them. There has never been a better time to try out my material for a full 365 days. At the old price (at least as of the time of this writing…the price may have gone up when you read this.)

Click here to get your 365 day trial of Mortgage Relief Formula

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