I don't see this as a good idea for the economy and the real estate market. In Waltham, it isn't out of the norm to have a home buyer put down as little as 3% on a home purchase loan, even in this market. Its how the middle class people are buying homes. The qualification process is much tighter now, and lenders and banks are taking great care to make sure today's buyers can actually afford the home.

Taking away the ability for buyers to put down less than 20% will only crush this very fragile market. I believe it will destroy home values and take away jobs. The middle class are the primary borrowers who seek loans with minimal down payments. Taking away these types of loans will take away the basic American dream for many people. Buying a home today is already difficult. For the most part, it requires dual incomes, good credit and solid employment history. With the cost of living constantly on the rise, saving money is a challenge.

The math is simple, for a $350,000 purchase, (This is less than the average sale price in Waltham) a 20% deposit would be $70,000! I read it would take the average American family over 15 yeas to save up a 20% down payment to purchase a home.

It's my opinion that there are no winners with this sort of regulation and I don't think it protects anyone. Home values would plummet, affecting everything including real estate tax, which are the revenues for local towns and city's. Home ownership shouldn't be this hard to obtain.

So why is the market slow? I believe there are a number of reasons which are all contributing to the slowdown. One, is the total number of buyers out looking for a home. It’s more difficult to qualify for a home loan than in the past. The banks and mortgage lenders are being very selective and stringent in the pre-approval process. This will limit the number of buyers in the buying pool. Also buyers are increasing there search area and looking in multiple communities. In the past, a buyer may have had two communities they concentrated on in their search area. Today, it's not unusual for a buyer to have three or even four other communities, thinning the flock of buyer even further. Lastly, until inventory decreases we'll have a slowing of the market. It takes buyers a lot more time to view all the homes in their price range and as more homes come on the market, buyers are reluctant to "pull the trigger" because, the buyer feels a better home could be just around the proverbial corner and are waiting to see if it will come on the market. Lastly, buyers are also waiting for prices to drop even more.

Home pricing can compound the issue because while new listing are coming on the market, sellers have a tendency to price their homes a little hirer than the current market will bare. I'm not saying the homes are being over priced but, sellers are pushing the limits at the beginning of the listing period. If a seller chooses to over price their home in the beginning, then as the listing sits, small price adjustment are necessary before a home may attract a buyer. The first price reductions on a property may be considered and assessed in the second to third week in the listing period, again adding to the slowing market place.

I believe the market place is poised to get stronger. As employment is on the rise and more people feel more secure in the jobs. For additional information regarding the current market refer to my housing reports for Single Family, Condominiums and Multi-Family properties.

One of the best programs for both the seller and the buyer is the Home Protection plan or HPP.

The Home Protection Plan is a product used by some REALTOR’s, like me, to add a layer of confidence and saleability to a home. In general, you can compare it to an extended warrantee for a car. The program protects all the "working” components and mechanical systems of a home from unexpected and costly breakdowns and repairs for one year after the buyer takes possession of the property. It covers plumbing, electrical, heating (some time limited), Air conditioning (sometimes limited) and most appliances. The program can even extend to the seller during the listing period.

Why would you want this? That’s simple, older homes have older working parts which buyers notice. A buyer walking into an older home starts thinking "what if” this breaks, or that fails? A plan like the HPP can take away the feeling of unknown "costs” with older homes and give the buyer a level of comfort that if "something” breaks, it’s covered and won’t effect their tight operating budget.

The HPP allows older home to compete with younger homes in the market place and is known to help a house fetch a better price. My past buyer clients know the HPP as a "DEAL SAVER” allowing them to buy a house the really love knowing a mechanical breakdown won’t break the bank. The HPP also can also help home inspection negotiations.

I always use the ERA Home Protection Plan and stand by the product. There is a fee to the program which will cost about $400. I personally feel this program is fantastic and have seen what it can do for both sellers and buyers. That’s why I will cover the cost of the program every time.

If you want further information on the HPP, please give me a call. I’d be more than happy to tell you all about it.