Batten down the hatches, lock the doors and cover the windows, the deluge of home PURCHASERS are about to start flooding the Tampa Home Market. While the doom and gloom of the real estate market has been loud and clear for some time, this is about to change for the better and in a big way. The reality is that there are a significant number of buyers in the market today and more are lining up. I fully believe that the pool of buyers will only surge in the next three quarters, and here’s why.
First, there are both major and minor investors that have been picking up properties in the truck loads for cash. These investors are not looking for the standard property flip; rather they are taking pools of money, buying foreclosed properties and renting them out for the considerable cash flow potential. As these property purchases occur inventory shrinks and the supply/demand line re-balance.
Second, there are many individuals that have been prudent during the last 5 to 7 years in regards to their finances. Sure we hear stories about homeowner X and Y that are underwater on their mortgage or can’t pay their current debt. However, there are even more individuals that did not extent themselves with homes they could not afford, or debt they could not repay. In fact, a recent survey by the Mortgage Bankers Association pointed to 20% of home loans in serious delinquency or foreclosure. While this number is high by historical perspective, there are still 80% of borrowers making things work. These people saved their cash, invested in cash producing assets and/or lived within their means. While times may have been difficult they reduced their outflows and maintained their budgets. These same individuals now have the ability to put their money to work and they are looking for deals.
Third, the unemployment numbers and household income numbers are expected to reduce and increase respectively. As people become employed and increase their income they tend to seek homeownership. Homes currently on the market are affordable at a number of different income levels and as long as the properties are priced correctly buyers will buy.
Fourth, as existing sellers see properties around them sell, they will wonder why their own home is not moving. This will force those sellers to either remove their home from the market (reducing supply), or lower the price of the property to be inline with market conditions and thus reaching buyers price point (increased demand).
The time has come, the deals are here and the opportunities are among us. Buyers that see a deal need to take it or risk losing it. While many might think this is a real estate agent’s self serving plug, the reality is that the smart money does not wait until the masses decide it is time to buy, they lead the pack! Put on your coat, get your umbrella and brave the Buyer Storm that is approaching.