Many economists have specified that the U.S. economy is a real estate driven machine. When housing it hot, so is our growth and when it's not; we fall into recession. Well it's safe to say at this point in time that the housing market for the past 3-4 years has been cooling off considerably. Most of this can be attributed to the financial lending landscape. It wasn't that long ago, in order to borrow money from a bank or financial institution, you needed to prove that you were able to pay that money back. Then the roaring '00s changed all that. The banks weren't looking at the long term implications of HOW one might repay a loan, and instead were focused on the HOW MUCH CAN I MAKE NOW.
In today's real estate market, it has become much more difficult to obtain a loan or even re-finance an existing loan. Many loans taken out in 2005-2008 were ARMs and they're coming to a head where the interest rates are going to jump creating a problem for many home owners that maxed out their limits to purchase said home. To make matters worse, some of those home owners lost their jobs when the economy slowed down taking a maxed out (2) income home and making it a stressed out (1) income home. Luckily for everyone involved, home owners, home buyers, and developers; June 1st is the date they should all have on their calendar as legislation has been passed to make the Short Sale process much faster allowing many home owners to get out from under upside down mortgages and new home buyers and developers to get some great deals.
To learn more about this click on the link and see how this process can be a turning point for the real estate market and possibly our economical outlook.
http://money.cnn.com/2012/04/19/real_estate/short-sales/index.htm
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