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Sales of Existing Homes fall 8.4% In March

By Erik Folgate

The latest news in the housing market is that existing home sales fell 8.4% from February to March. This is the sharpest drop in home sales in 18 years. So, what does this mean? Obviously, the housing market is at the bottom of the cycle right now. But, that was expected after one of the hugest booms the United States ever saw from 2003 to 2005 to home sales. We must remember that other external factors affected this drop in existing sales. March was a cold month for much of the country, and all of the controversy over the subprime lending market led less people to be able to qualify for loans as mortgage companies tightened up on their underwriting guidelines. I have written on this blog in the past that there is nothing to worry about when it comes to the housing market, and I still do not think there is much to worry about. It’s true that you are going to have a harder time selling your house right now, but check out my article on selling your house in less than 60 days and you’ll find tips that are relevant for selling your home in any housing market. You may have to sacrifice a little on your asking price, throw in some upgrades, and maybe pay half of the closing costs, but it’s worth it if you need to sell your house quickly.

We must remember that the housing market is extremely cyclical. What goes up, must come down, and vice versa. All of these articles you are reading are just trying to scare you into thinking that the housing market is crashing. In my opinion, it’s still not crashing, it’s just leveling out from the huge boom that we experienced 3 years ago.

What would a money crasher do? A money crasher would not worry about what the paper or the National Realtors Association was telling us about our homes. If you truly need to sell your home right now, then be creative, clean up your house, and use your best negotiation skills. You’ll still come out on top without sacrificing too much. This can also be a great time to buy rental and investment properties. It is definitely a buyer’s market right now, and you can find some great deals in pre-foreclosures and sellers desperate to get out of their adjustable rate mortgage. If you are smart about it, you could be raking in the benefits when the market starts booming again. And believe me, what goes down, WILL go back up. The question is, are you patient enough to wait for that to happen?

What are your thoughts about the housing market? Do you think that I’m way off on my assessment, or do you generally agree with me? I’d like to know, because I’m definitely not an expert on real estate.

Erik Folgate
Erik and his wife, Lindzee, live in Orlando, Florida with a baby boy on the way. Erik works as an account manager for a marketing company, and considers counseling friends, family and the readers of Money Crashers his personal ministry to others. Erik became passionate about personal finance and helping others make wise financial decisions after racking up over $20k in credit card and student loan debt within the first two years of college.

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