October 11th, 2012
Low mortgage rates and favorable home prices are prompting many potential buyers to contact a mortgage consultant to take advantage of housing affordability. However, those who do not act quickly enough may miss out on their chance to explore several housing options as inventory continues to shrink.
According to a recent Zillow analysis, national inventory of homes has shrank by nearly one-fifth – or 19.4 percent – during the past year. Falling inventory has affected U.S. states disproportionately, with California experiencing the most significant declines in low-priced homes, with inventories shrinking by 40 percent.
"First-time homebuyers are being squeezed out of the market by falling inventory and the rapid influx of investors looking to buy basic homes to rent out to the growing population of people who have recently been foreclosed upon," said Stan Humphries, Zillow chief economist. "Investors are paying in cash and can close sooner, which is more favorable to banks and homeowners looking to sell."
While making the decision to purchase a home should be reviewed carefully, those who are trying to take advantage of unprecedented home affordability should start thinking seriously about whether they are willing to make the investment.