Foreclosures Can Be A Good Thing Too
by Jeff Adams
They say there’s never a cloud without a silver lining and it certainly would
seem so where foreclosures are concerned. The fact that so many foreclosures are
now hitting the market is a clear indication that a market correction mechanism
is in operation in the world of property speculation and real estate and it is
part of the market’s self-correcting ability to stabilise every time it
overheats.
Let’s look at this process a little more closely so we understand it: Left
unchecked here’s what can happen to the real estate market. Properties begin to
increase in price and value. The growing value of those who have already bought
a property allows them to sell on so they can then invest in a bigger, more
expensive one.
Those who are already in expensive properties take out second and third
mortgages, releasing the equity in their property and enjoying some of the finer
things in life. So far, so good. But, left unchecked the increase in house
prices begins to force a lock out and a lock down. Those looking to get their
foot on the first rung of the property ladder are beginning to get locked out as
house prices on starter homes also experience an increase.
With no new buyers coming into the market those who are in the middle ground and
need to sell on so they can move up begin to experience a lock down as sales
begin to drop and buyers become sparse in a market that has suddenly got not
just too expensive for them but also one lacking in movement.
This, in turn affects the entire real estate economy which relies on new home
buyers for its buoyancy. You begin now to see why foreclosures can be considered
a good thing. By ‘hitting’ those who have bad credit foreclosures break the
impasse of the lock down and the barrier of the lock out and release, in the
real estate market, a fresh spate of properties which are affordable and can
enable buyers to come in at a level they could not before.
This also mobilises the market as new buyers, generally, spend more than those
upgrading or staying put, and it stimulates the economy which stimulates growth
and jobs and begins to finance credit and homes and the whole cycle starts
again.
Am I oversimplifying a little? Definitely yes and I am not for a moment making
light of the personal tragedy for the aspiring home owner which is a
foreclosure, but you can see how from a market mechanics point of view
foreclosures are a necessary self-correcting mechanism which allows the real
estate market to be truly self-sustaining.
Bio:
Jeff Adams is the nation’s leading expert in finding motivated sellers, hungry
buyers, and private lenders through the Internet. His automated websites for
attracting buyers, sellers, and investors has allowed him to do over 350 deals
since 1995 while having a regular job the whole time as a firefighter!
Jeff grew up in Southern California and became a firefighter in 1987. In his 18
full-time years with the fire department, Jeff’s put his life on the line with
the L.A. riots, Northridge Earthquake, Malibu brushfires and L.A. high-rise
fires. He’s even had duty on a fire boat.
Jeff Adams owns and operates We Buy Houses For Cash Investment Group, LLC. He
buys 5-7 houses a month.
Jeff’s had nothing handed to him. He’s worked his way up the firefighter ladder,
from newest rookie to Fire Captain. Jeff Adams worked his way up the real estate
ladder, from an overwhelmed beginner, to now being a nationally recognized
expert at web-based systems for buying, financing, and selling properties while
still having your day job.