Market Bottom and Affordable Prices Draw Investors to Real Estate

Affordable prices and what looks like the bottom of the housing market are attracting investors to the housing markets today, as the number of consumers interested in investing in real estate  has doubled since March 2009, according to the recently released Homeownership Survey. Low prices, the extended and expanded home buyer tax credit ($8,000 for first-time buyers, $6,500 for those who have previously owned), short sales and foreclosures bargains, and the feeling that the matter has in fact hit bottom have also become the most important reasons motivating buyers to purchase a home.According to the survey, one out of eight (12.1%) homebuyers today plan to purchase a home as an investment property, compared to 5.6% seven months ago. Of those interested in buying a home for investment, 15.8% were men and 8.1% were women.Short Sale and Foreclosure buyers, accounting for 25.3% of consumers interested in purchasing a home, are a major source of potential investment activity for today™s housing market. Forty-two percent (42%) of potential short sale / foreclosure buyers regard their purchases as investments, while 57.6% plan to live in the homes themselves. Short Sale / Foreclosure investors, according to the survey, intend to convert these homes into rentals (13.2%), fix them up for re-sale (11.3%), or house a family member until the home can be sold at a profit (17.4%). Of the 42% interested in purchasing a short sale / foreclosure as an investment, survey respondents ages 35 to 49 (52.6%) were by far the largest demographic.Expected Profits Gained From Purchase Discounts and AppreciationThe survey found short sale / foreclosure buyers expect to profit from both deeply discounted purchase prices, as well as healthy appreciation rates over five years. Most short sale / foreclosure buyers (58.2%) expect to pay 20% or less than market price for these properties, while 38.5% expect a 25% or greater discount. While, 73% expect their properties to appreciate ten percent or more in five years, 28% expect their purchases to appreciate 20% or more during that same investment horizon.According to the Federal Housing Finance Administration™s Purchase Index, homes have appreciated an average of 15% nationally since 2004. According to the survey, the most important reasons motivating prospective home buyers and investors to purchase a house include concerns that prices are as low as they will go (23.6%) and the desire to take advantage of foreclosure bargains (18.7%). The second most important reasons motivating property purchases include taking advantage of the great selection of homes for sale in their community (21.2%) and concern interest rates will rise (14.2%).œThis latest Homeownership Survey validates what many had hoped to see in the housing markets “ affordable prices and ample inventories are restoring the appeal of real estate to investors while providing opportunities for first-time home buyers to enter the market, said Move, Inc., Chief Revenue Officer, Errol Samuelson. œIn today™s environment, regardless of whether you™re an investor or interested in purchasing a home to live in yourself, residential real estate is a more attractive investment today for many than it has been in recent years.Fear of Foreclosure FadesWhile foreclosure filings reached record levels in the third quarter in 2009, with one in every 136 American homes receiving a foreclosure filing, homeowners today are actually less concerned that they or someone they know may be facing foreclosure as compared to seven months ago. In March 2009, 52.5% of all survey respondents said they were concerned that they or someone they know may face foreclosure in the next 6 to 12 months. That number dipped slightly to 45.1% in October 2009. According to the survey, fear of foreclosure today is greater among women (49.3%), with people earning $50,000 or more annually (43.9%), and with people living in the South (42.6%) and West (55%). The six states today with the highest rate of foreclosures are California, Florida, Arizona, Nevada, Illinois, and Michigan. These six states accounted for 62% of the nation™s total foreclosure activity in the third quarter of this year.If you, or someone you know is considering  Buying or Selling a Home in Columbus, Ohio  please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!The Opland Group  Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;    Bexley    Columbus    Delaware    Downtown    Dublin    Gahanna    Grandview Heights   Granville   Grove City   Groveport    Hilliard   Lewis Center    New Albany   Pickerington    Polaris    Powell      Upper Arlington    Westerville    Worthington

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