Surge in Risky Home Loans Could Affect Dallas Real Estate
New fears of risky mortgage lending could make things more challenging for selling real estate in Dallas, TX.
While there are many positive things happening in the economy, some analysts and industry experts are growing increasingly concerned over the return of risky lending practices and pending defaults.
When those fears become a reality, it may be hard, if not almost impossible for a Dallas real estate owner to sell a house fast in Dallas, or at all.
The Clouds on the Horizon
A new CNBC report raises the alarm over the amount of loan down payment mortgages being handed out to weak borrowers, while credit scores slide downwards. At the same time some lenders are reporting they are offering 200 percent more loans to “outside of the box” borrowers.
Twenty-one percent more existing homeowners have also been raiding their home equity with loans and adjustable rate lines of credit. Fannie Mae and Freddie Mac have also forecast that they will blow through lending caps this year as they rush to lend billions of dollars.
Meanwhile we are facing rising interest rates and billions of dollars in commercial real estate loans which are expected to go into default in 2017. If loans start going bad, and lenders pull back, that hurts potential buyers in Dallas real estate and elsewhere.
That leads to stagnant real estate markets, and declining home values. It won’t take much to put those who have been using FHA loans, other subprime-type loans, and home equity loans underwater. When foreclosure start mounting, the banks are unlikely to be forgiving this time around.
Dallas Real Estate Market
Dallas has been enjoying a furious run. Prices have been soaring, new building has been busy, and rents are high. During the 2008 housing market crash, the DFW area was more insulated than other markets. It hadn’t grown as fast, and was still seeing good transaction activity after Miami and NYC popped. It may not fare as well this time around.
Some may soon begin to talk about a “soft landing.” So far that has been almost impossible to achieve throughout history and around the world. When you are flying something this big and heavy, and the engines go out, gravity takes over. Unfortunately, numbers showing these turning points in the market normally don’t surface until several months after the market has actually turned.
Selling Your Dallas Real Estate
On the bright side selling houses quick has become easier in one sense. Thanks to improving technology some buyers are able to act fast and pay fair prices, without owners having to go through all the quirks traditionally associated with realtors or homes for sale by owner in Dallas, TX.
Those that still have the capital to purchase property can do so quickly, and can make sense of transactions while those needing financing can’t.
They can afford to make repairs, so selling a house as-is, is possible, and they don’t mind holding, when others can’t. The only caveat here is that these local investor-buyers may soon be inundated with requests from owners eager to get out of their homes before the market takes an ugly turn.
If you have been thinking about taking advantage of the current Dallas real estate market, the time may be right to see how much you can get for your property. Contact DFW Sell Fast at817-601-7777; we buy houses in Dallas in any condition for cash.