Market Turmoil Makes Homebuyers Think Twice

Real estate agents and brokers say turmoil in financial markets is planting doubts in the minds of some would-be homebuyers even as it signals opportunity for others.

Plunging stock prices initially sparked by the downgrade of the U.S.'s long-term debt rating and reinforced by lingering fears of a European debt crisis don't necessarily signal that the U.S. is headed into a "double dip" recession.

So far, investor flight to the relative safety of bonds and mortgage-backed securities that fund most home loans has pushed the cost of borrowing down -- a boon for both homebuyers and homeowners looking to refinance.

But recent revisions to previous Commerce Department reports on economic growth show the depth of the recession was worse than previously known, and that growth has been more anemic this year than previously reported.

If that trend worsens, and unemployment rises as the workforce grows faster than new jobs are created, that could undermine home prices in some markets, making it harder to get buyers off the fence.

"We had gained quite a bit of positive momentum over the last several months," said Hinsdale, Ill.-based broker Brian S. Hickey of Teardowns.com. "We seem to be giving up that confidence at the moment, with buyers taking a wait-and-see attitude for today, anyway."

Read the full story at Inman News.

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myles061842

I have never seen a better time to be a buyer. Rates are at an all time low, there is plenty of good inventory and people must live somewhere, why not in their own homes. In my 25 years in this business I have not seen such opportunity that exist today. Smart investor's are buyer everything they can and why not. Property values will rebound, it may take a few years, but values will once again start increasing and what better investmentment can you make for your future?

That's my two cents.

Myles

August 15 2011 at 5:06 PM Report abuse rate up rate down Reply