The unstable economy has home buyers walking on egg shells. The real estate market is either at a slow walk or a dead stand still these days. This is because individuals are losing their jobs left and right. Unfortunately, No one is sure what the future of the economy has in store for the citizens of the United States and this has most Americans fearful of purchasing a home.
Most individuals have this uncertainty of whether their jobs will last through this economic struggle, which has people being more conscious of their spending. For instance, most people are terrified to step into a long term contract of purchasing a home when there are so many individuals who are losing their homes due to the inability to pay their monthly mortgage payment. When you are unsure of whether or not your job will be there for you to go to tomorrow, buying a new house is the furthest thing on your mind.
The recent crash
This past September the amount of building permits that were purchased in order to start construction on a new home sank from the previous amount of 2.22 million to an amount of 2.07 million. This was the second weakest amount since the year of 2005. The housing market is definitely starting to take an obvious slow down since previous years. This can be mostly blamed on the economic struggle that the United States is currently battling.
During the time frame of October through December of 2007, the foreclosure amount set a record at .83 percent. Prior to then in the months of July through September, the rate had been at .78 percent. During 2007, the amount of individuals who were considered delinquent on their mortgage payments, which means that they were thirty days past due or more, was 5.82 percent. This is the highest percentage of delinquent mortgage accounts that the United States has seen since the year of 1985.
But why?
The lack of full time jobs and the excessive rate of layoffs and business shut downs have caused a domino effect in the economy. Individuals begin losing their jobs, then they become behind on their mortgage payment, and then their home goes in to foreclosure. It is no wonder why the housing market has almost come to a stand still, individuals have either already been effected by foreclosure or become behind on their payments or they will not enter a purchase agreement in fear that they will end up in the same scenario.
Fortunately at this very moment, the amount of foreclosures is at a stand still. With the current plea bargains with homeowners that the government is attempting to work about the amount is maintaining itself. Mortgage companies are working to lower payments and interest and work out payment plans for individuals who are behind on their payments in order to help them keep their home. Hopefully, with these sorts of programs we will be able to put a halt on home foreclosures.
