Hmmmmm…….

What about some kind of ALL-NORTH-AMERICA-MILLION-POUND-SHITHAMMER natural disaster for the inventories, and then we could nuke the Swiss and steal their gold?

2008 looks grim.

But isn’t that just the current guidelines? If 2008 turns out bad, or worse than 2007, which I tend to think it will, I think this will get raised.

The issue for the builder’s, is that this is out of their control. Drop prices if you want, it will take time for the current generation to save a down payment, especially if it’s the middle of a recession.

How can we get rid of historic inventories without lots of buyers? How can we have lots of buyers with restrictive lending and little savings?

Most of the major mortgage insurers have already deemed the Twin Cities MSA a declining market en masse…which means that even if your appraisal says it is NOT declining, nobody will insure your loan without a 5% down payment.

The credit crunch is getting crunchier.

Better to have a single page:

“No matter your circumstances, future plans, what you are thinking, or what you have heard, NOW is a good time to buy a home.”

I keep waiting for the trade orgs to catch on to the fact that if they actually are honest with their audience, many of them will still buy homes with their eyes wide open.

Alot of homes were being sold with little money down, those potential buyers now often have to save a larger down payment to qualify for a mortgage.

Example: 300K home bought with 5% down required 15k saved. If the builders deeply discount that property 10% to 270K, but lenders require 10% down now, requires 27k saved.

People are having to learn how to save again. Personally I think this is also keeping a good portion of potential home buyers on the sidelines for the next couple of years.