There is a report this morning that Zillow Mortgage Company, when it surveyed a sampling of U.S. residents, found that fully one-third did not feel that today they would qualify for a home mortgage.
Studies like this are always suspect in accuracy, but nevertheless, those of us who service the home buyers and sellers know that such a prediction would be true for a significant percentage of the adult population.
The positive side of this equation is that demand for housing can't shrink unless the population does. And that's not likely to happen.
People are living longer, and those of childbearing age are still having children.
And whether the mortgage industry, commercial banks and the government mortgage programs like it or not, they are forced to satisfy that need.
So either the strain will show its increase on rental units, on single family homes or both.
Meanwhile, the foreclosed home unit inventory will be removed from the market by attrition, while home and apartment builders wait for signs that there is demand for their products.
Values, in general, of the homes standing today will increase to levels that were above their previous high, as demand exceeds supply. New homes will cost more to build, so they will cost more to buy.
With respect to the government's secondary mortgage programs, what will lie in their future will be the requirement that the originators of the loans keep a portion of the loans themselves. And that is the obvious way to seriously constrain bad underwriting.
For the home buyer who qualifies for a mortgage today, now is the time to buy, now is the time to trade-up, now is the time to accumulate rental units -- whether single family, apartment units, or both. The value is there and the demand is on its way.
BILL CHERRY, REALTORS
DALLAS - PARK CITIES
Since 1964
214 503-8563
