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On GMA this AM there was a segment on how the nation as a whole can't make purchases because interest rates are so high. Cars, homes, credit cards you name it. Everything is taking a big nose dive. Thanks for the article.
And:
"Sales began slowing here last fall largely because many potential buyers couldn't sell their homes in overbuilt markets elsewhere."
That supports the fact that we are in a desirable area with lots of Buyer interest. And, yes, it has been a problem for the last 12 months.
We will not be a Michigan, Texas, or South Florida in terms of foreclosures and slough in the market because of strong local fundamentals.
Good stuff sells. We have lots of Buyer interest. First time buyers have nothing to sell, and many people don't abuse their credit. They are out there.
The line in the article about even JUMBO borrowers paying a higher rate was a little incoherent. Not researched as to "why." But it is the N&O, after all. JUMBO borrowers ALWAYS pay a higher rate. It has ALWAYS been a higher risk loan to the lender.
I am still in one of those other areas and there is no comparison with Raleigh. There are lots of people wanting to move to Raleigh and pay the reasonable prices there. They are having a slow time selling high elsewhere but want to be THERE. The problem elsewhere is that less people want to be in that elsewhere. That is a long term problem and Raleigh is a short term situation.
If the prediction is slow down through 2008, I think early next year might be a good time to buy something. If the inventory is rising, builders will be aching to unload it.
I already see many builders dropping their prices by as much as 15% from the original price. It is hard to believe that heir profit margin is more than 15%. A little bit more squeeze, and they will give it away for free...
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