There are continued talks about investors who were having second thoughts on purchasing residential real estate or will investors turn to stock market instead, just because it's market is on a moderate pace.
David Berson, chief economist with mortgage company Fannie Mae said "We can't find a period when the investor share of home sales has been higher than in the last year," he also added "However, in the fourth quarter, it looked like investors were starting to step back. We just don't know for certain how far that's going to go." Fannie Mae, is the largest player on the secondary market.
Berson said that "We obviously track the mortgage activity and understand that overall share, but we don't focus on how many homes are being purchased by investors without a mortgage," Berson also adds "That could be a more interesting part of the housing picture."
Along with Berson is Chief economist David Seiders of the National Assn. of Home Builders and also Freddie Mac's Frank Nothaft, they all share the same prediction for home sales this year, they say it is likely to dip.
Berson said on a comment that "We expect housing activity to drop about 8% this year. It's primarily because of the investors' slowing purchases," he adds "And … the condo market is slowing considerably. It's no surprise because that's the type of housing investors most favor; there is no lawn to mow and you don't have to shovel the snow."
The reason for the dip of the home sales, well obviously because the homes are now slightly expensive because of the higher interest rates and continues increase in home prices, that very well made its market for homes unaffordable.
By: Dijon Wainwright
http://www.realestateportal.org/article.php?story=20060211100034243