An inside look at Chicago real estate

Recovery in the Mortgage Industry is Promising for Housing Market

Mark.Miles By
Mark Miles
   | Mortgage

As the situation revolving around the home loan industry is righted, things are starting to look promising for 2008’s housing market. A number of factors are falling into place that will help residential real estate in the upcoming year – a shift that both economic forecasters and individual Realtors® are already taking note of.

With a watchful eye and careful attention to borrowers’ qualifications, lenders are expanding credit accessibility to homebuyers, who still benefit from mortgage rates at near historic lows. In addition, Federal Housing Administration loans are acting as an alternative to the failed subprime home loans, which triggered numerous foreclosures across the country. So, as mortgage conditions continue to get better for potential buyers, the circumstances surrounding the national housing market are looking good with 2007 ending in a favorable position. According the National Association of Realtors®, this year will see the fifth highest number of existing home sales ever reported. The NAR says that, on average, one in 16 households will purchase residential property in 2007. All that buying means the surplus housing inventory is diminishing which will help stabilize and increase home prices overall. An additional reduction in new housing starts also benefits existing home values and is working to further shrink the excess supply of residential real estate in the U.S.

While this is good news for the national housing market, it is always important to keep the small picture in mind. Finding out what is happening in the local market is invaluable when it comes to buying or selling a home. Real estate agents are alert to their surroundings, narrowing the scope from countrywide to a neighborhood by neighborhood basis. With the assistance and guidance of a professional, homebuyers and sellers are able to work with the specific market at hand and adjust to localized conditions, making the most of any housing situation that comes along.