How To Buy A Home In 2007 By Trisha Dingillo At Isnare.com Ezine Articles

Due to housing bubble deflation we must learn New Lending Rules for a New Era in Real Estate. Especially those with bad credit as subprime lending is vanishing.

Times, they are changing, and we have been spoiled by low interest rates, easily obtainable financing and a thriving real estate market. Otherwise known as the housing bubble.

This has led many buyers to wait it out until the market levels out at its lowest pricing. Unfortunately no one can predict when this will be, or if a certain areas will experience complete market devastation. What may be good for buyers is the rapid decline in home values and the incredible inventory of homes available. Is the housing bubble bursting? or just deflating...

Barrons Magazine stated in August of 2006 that sales are down by 10% and predicted that housing pricing will fall 30% over the next three years. Large cities such as Boston and areas in California and Florida have been feeling the effects of this hard hit in falling home prices.

In May of 2006 Fortune Magazine warned buyers beware of areas experiencing market devastation, separated into 3 categories, "Dead Zones", "Danger Zones", and "Safe Zones". The Dead Zones included Boston, Las Vegas, Miami, Washington DC, Phoenix, Sacramento and San Diego. Danger Zones included Chicago, Los Angeles, New York, San Francisco/Oakland and Seattle. And Safe Zones included Cleveland, Columbus, Dallas, Houston, Kansas City, Omaha and Pittsburgh.

The zones are a good rule of thumb, but to be absolutely up to date - check CNN Moneys latest home prices, which shows the exact appreciation or depreciation for 172 markets. If you are looking to buy in a depreciating market, make sure that you can afford the home for the long haul, make sure that you have a large emergency fund and don not be too concerned if your homes value drops for a few years. The market will turn around, it always does.

The conjoining trend for 2007 is vanishing easy money such as bad credit loans and no down payment loans. Banks are tightening their belts. Availability of easy to obtain financing is disappearing as more banks which provided these types of loans go out of business. Qualifications for home purchases are becoming much stricter. Seeing the market as it is, it is actually good for home buyers to have stricter guidelines to avoid foreclosure, but it means more work for the home buyer. You will need to prove total financial job security. You will need to have good credit (between 650-680 is ideal, but 620 is still the minimum). You will also need a substantial down payment.

If you are not in the position to provide these things, it may take some work to get there, but will be well worth it in the end, and you will be much better situated for financial success.

Buyers in 2007 should remember that preparation is key. Do not take anyones word for it, not even mine. The market is changing drastically and will continue to do so in the next few years. Nobody really knows what is going to happen. Make sure to do some homework before you purchase your home.

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