Gloom and Doom

Have you seen the news lately, among the murders and assults, homes are making the headlines. Foreclosures are up, sales prices are down, interest rates and flexing. Gloom and Doom in Real Estate. Real Estate has a legal term called "puffing", and the media is guilty of this on many counts. Salem and the valley have not seen the drastic trends of California or Florida even Vegas. We have always been a little behind times and our RE market is the same way. That is why last year we say some of the best appreciation in the nation. Why, because we began to catch up. It took 2 years to catch up but the market today in Salem is steady. We are seeing fair prices and fair market time. Buyers are commodities. The supply and demand curve is askew with more and more supply but homes are still holding strong to price. New Construction is flooding supply, but they will eventually sell too!

The Gloom and Doom however is mostly driven by financing. Over the last three years ARMs and IO flooded the market. When people lose their homes the banks start raising rates and lending less money with less risk. The short of it is the banks messed up! They lended too much at exotic rates in exotic programs. The beginning of a new age has come. It is time to get back to the old days of Owner Carries. The owner can put up 5 to 10% for down payment.

Gloom and Doom is true for the days of 100% financing and exotic loans, but Salem has it good right now!