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Home Sales Decrease, Down by 80% since the Industry Boom
Do not count on the new home market for a better economy. Home builders suffered a bad month yet again in October, reaching only a fifth of the rate of sales that they were enjoying during the industry boom five years ago.
Sales of new homes fell to an annual average at just 283,000. This was according to the Commerce Department. This is 8.1 percent lower than the already low performance in September and 28.5 percent a year ago when the rate was at 430,000 every year.
Experts on the housing market from Briefing.com forecasted that the market should reach at least 314,000 in home sales, but the actual figures now show that the performance is significantly lower.
According to Mike Larson, an analyst of the housing market from Weiss Research, the new home market was again at a disappointing state when sales plummeted to the bottom, all across the whole country.
New home sales are almost 80 percent lower than the pace that it had during the boom, which reached 1.4 million a year. Set in July 2005, that figure is now a distant past, as sales continue to stay at historic lows, even as mortgage interest rates go low and significantly lower the prices of new homes.
The Commerce Department revised the August sales figures as well, lowering it to 275,000 homes a year. This is a record low in the new home market ever since it started to track sales in 1963.
According to David Crowe, the National Association of Home Builders’ chief economist, more people are scared to buy new homes because of the grim economy, which has a lot of negative effects on the average American family. Unemployment and instability hinders them from committing to a long time of paying mortgages.
Usually, forming households increase a percent every year, as people get married, immigrants come, and careers are launched.
However, the economy has continued to slow down the personal advancement of the American. With most new graduates finding it hard to find a launch pad for their career, fewer immigrants come to the country and more couples delay marriages.
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The Advantages Of Purchasing A Home Via Lease To Own (with Low Down Payment And Bad Credit)
Folks have different reasons for avoiding owning homes. Some factor is their less than stellar credit scores into the situation. This gives them limited access to mortgage plans, with only those that are laden with ridiculous interest rates usually available. Others who are able to acquire financing have limited cash flows. This hinders them from coming up with considerable down-payment amounts for home purchases. And there are those who hold satisfactory paying jobs, yet their status as new immigrants immediately crosses them out from home ownership opportunities. Whatever the reasons may be, it is refreshing to know that there is a viable option available if you are one of the folks described above, and that is through lease to own. Unsure how this system will work to your benefit? Then read on to find out.
1.You get access to immediate home ownership opportunities. The lease to buy option, just like its name suggests, first starts out as a lease agreement between you and the house owner. But instead of just renting out the property, you are presented with the chance to buy it after the lease agreement expires. This then translates to instant home ownership, as you are essentially already considered the owner of the home the moment you move in. Hate the tile work in the bathroom? Then by all means have it changed! You can make as many improvements or modifications as you want and not worry about what the landlord will say.
2.Only requires payment of really affordable amounts. With home purchasing, you are required to fork over at least 5% of the propertys worth to cover lender fees, realtor shares, and equity payments. With rent to own however, this is not usually the case. All you need to come up with is the option deposit amount that is usually just twice of what you will usually pay for when closing a home rental deal. Whats best, the option deposit will be deducted from the overall price of the home once you finally decide to avail of your option to buy.
3.Provides you with the chance to opt out of buying. There are a number of reasons that could affect your decision to buy the home. First off, if you think the home will lose its value in the future, then you may decide against buying it. Or perhaps through the span of the lease to own agreement you find out the neighborhood is not really somewhere you would like to raise a family. Probably the neighbors are boisterous, or maybe the area has its considerable share of crimes. Whatever your reservations may be, you have the option to not proceed with the deal to buy. And if you indeed decide to abort the deal, you will lose the option deposit, which is a fairly low investment considering all the home ownership opportunities you have gained access to.
Lastly, deciding to avail of the lease to buy option from a reputable seller has a number of benefits when you look at it from a legal standpoint. Firstly, you will be protected from evictions. Questionable home sellers typically just pocket monthly lease payments and not take care of current dues such as mortgage, real estate tax, or insurance coverage. Through a respectable seller, all these dues will already be included in your monthly payments. This way, you need not have to worry about paying them on time, or worse, get caught unawares with an eviction notice from the lender. Secondly, by dealing with a reputable seller, you are protected from unknown transfers while the rent to own agreement is in full effect. So you need not fear of having to give up the home you have been paying for religiously to someone who happens to hold a legally binding deed of transfer.
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