Navigating Negative Headlines

So which would you like to hear first, the good news or the bad news? Well, for most it’s an easy choice, the bad news comes out on top. Studies have shown that people are more attracted to negative news than positive, and no one does a better job of this than the media. Even in the midst of one of the most active real estate markets we have seen in years, the headlines have focused on “the wave of foreclosure” that is coming.
It is important that you are armed with the facts, not the hype that drives headlines because the truth is that we do not anticipate a “wave of foreclosures” across our Southern California market and this is why:
  1. While mortgage forbearance has been extended from three months to one year, which is what many fear could lead to a mass foreclosure situation, the fact is that we are not seeing the extensions play out in our Southern California markets, especially in the coastal and higher-end markets. Forbearance extensions are focused on the lower end of the market across the state and county.
  2. The number of homebuyers in San Diego County, Orange County, and the Coachella Valley far surpasses the number of properties for sale, at the same time new home construction is far below demand.
  3. There is no indication that demand will diminish with interest rates from 2.25% to 3.5%. Unless we see the economy strongly improving, we will continue to see low interest rates.
So for the good news - homebuyers should not bank on waiting for prices to drop because of the headlines predicting foreclosures - the opportune time to purchase is NOW.

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