The Liquidity of Money is Creating Buying Opportunities for Some

Dan Green, a mortgage broker in Illinois, recently posted this interesting video about how changing mortgage guidelines are affecting the real estate markets. I found it to be a nice simple explanation.

As interest rates move lower, on the heels of yesterdays global stock market sell off, many are wondering if the real estate markets will begin to bounce upward. This video shows that more than just interest rates are affecting the US real estate markets. The liquidity of money is an important mechanic of our market.

This video also illustrates why our current market is such a tremendous buying opportunity for qualified long term Bay Area buyers. With the contraction of the mortgage guidelines we have seen less qualified buyers in the market. As we are seeing in the Bay Area this has led to less competition for homes. This is an unusual shift in the moods of Bay Area home owners. The Bay Area typically has a robust history and a diverse stable economic base. Thus, those who can meet the guidelines have an entrance into an exclusive group of buyers that are seeing real purchasing power. Now, if you are also a buyer who is looking to stay in your next home for, lets say 5-10 years, then you have a solid base for riding out future fluctuations in the real estate markets. It is my assessment, that we are currently experiencing a rare buying opportunity in the Bay Area real estate markets, where rates are low and the competition for homes has slimmed.