Consumer confidence is still somewhat low in regards to home prices, but there are also homeowners who feel that rates on home loans will likely remain quite affordable in the coming months, which has been similar statements released by a variety of professionals, officials, and housing organizations, as there are some who believe that while rates on home loans may stay more affordable, housing prices may continue to fall in some areas. This is created a situation where homeowners are uncertain about not only housing but, as we have seen over the past month, the stability of the personal financial lives of some of these potential homebuyers may also be in question and would be the reason behind why more homeowners are not taking advantage of new home buying opportunities.
Recently, Fannie Mae stated that a survey they conducted echoed the sentiments that many Americans feel stating that rates will likely stay low, as a small number of homeowners feel rates on home loans will rise, but there are also homeowners who feel that prices may still be a problem, which again is a sentiment that some officials believe to be the case in the housing market as well. Yet, this is the cause of what many feel to be one of the main problems in the housing market as uncertainty in not only the personal lives of consumers but the housing market in general may be creating somewhat of a self-fulfilling prophecy.
What this means is that consumers are hesitant to buy, which has left a great number of foreclosed properties around the nation, and these empty homes have been dragging down home prices in these areas, which in turn has created numerous problems for current homeowners as well. As there are many banks working to unload these properties, and even prevent foreclosed homes from arising in greater number through the use of options like short sales, there is hope that when homeowners feel home prices may stop decreasing that they may begin entering the housing market once again, hopefully while rates are still low.
However, buying a home is a major responsibility so many consumers are also looking at the job market and overall economy, not simply the housing market, when it comes to their decision to buy. Last year we saw some success with the first-time homebuyer’s tax credit, but consumers are still in a position where they feel unsure about their ability to afford a home, whether their home will keep its value, and whether the costs associated with acquiring a home loan can be met at the present time.
Obviously, the decision to purchase a home is a personal choice that only a potential buyer can make, and it is a major step in the financial life of any consumer, but there is some concern that hesitation on the part of homeowners to begin buying foreclosed properties could lead to continued drops or a lack of increase in home prices, since many markets may have numerous homes without an occupant or potential buyers, but until the markets start to improve there is worry that buyers will still be hesitant as they want to see home prices improve as well. It’s understandable though that homeowners want to see more positive numbers in terms of job opportunities, home prices, and stability in their own financial life, as this hesitation to buy may not simply surround home prices but the potential lack of confidence that some consumers have when it comes to their ability to simply afford a mortgage payment for the long-term.