After the Smoke Clears

Wayne county has been somewhat protected from the mortgage fallout in 2007 due to the fact that our market never seems to have a big price boom like more metropolitan areas. However, we started feeling the credit "squeeze" near the end of last year and it blew in hard the first quarter of this year.

If you know anything about credit scores, you understand how they affect your ability to get a loan. During the great sub-prime days of the past booming years, we saw clients with 560 or lower scores get loans. Now, it seems for even a government backed FHA loan clients need to have 620 or even higher depending on circumstances just to get a loan.

This increase in criteria has caused a slow-down in our market. Homes are still moving and certain pockets of the county still do not appear to be affected. However, we are starting to see very mild price pressures and a slowdown in new construction starts. These price reductions do not seem to be in vain though.

We have seen an increase in buyer activity in the past few weeks. The reductions and/or lack of home price increases, combined with some government tinkering with interest rates, and beautiful early spring weather has stimulated our real estate market. Our company outlook for later spring and summer is very positive. We currently have the most listings in company history and our web traffic is continually increasing. Web traffic is a great indicator of buyer activity since most buyers go to the internet first, before actually calling an agent. The government continues to tinker with FHA loans and interest rates. We'll have to see what affect these things have on the market over the next few months. We are all watching.

I'll have a first quarter report available the first of April.