I disagree to a certain extent. For first-time home buyers looking for a home instead of an investment to be flipped in a couple of years, it is a solid opportunity - they now can afford the 20 percent down payment and the mortage rates are very low. I do agree that the solution is not to revert back to the bad old days of ninja loans, but there were a lot of folks on the sidelines who can now enter the game - IF they are looking for a long-term residence. And bringing such buyers into the market is what is needed.
And what happens next year: when the 20% down payment is lost because this POS house is only worth $ 160,000 on the market? Of course, they will email you and ask for their $ 40,000 back.
True, as long as the seller and real estate company sign an agreement that they will guarantee the price for the next five years.
With 8.5% unemployment rate there are not enough people that can qualify to buy the millions of foreclosed homes not even close. Unless of course the banks are lending subprime again and hence the horror cycle will start again.
The Lodi of this article is on the northern outskirts of Stockton, California. The economy is primarily agrarian there, specializing in generic wine grapes.
Decent paying jobs are at least 80 minutes away, so it will not be bouncing back soon. Nearby Stockton is a bad news, dying place, with high crime, and ugly leftist government.