With the stock market not doing so well, I know many investors ready to put their money back into real estate where you can at least cash flow on the right investment and have a steady long term appreciation. Plus, they also agree on the buy low, sell high principle and they believe the real estate market is ripe for picking.
I just heard that as of October 15, 2008, there are no longer any MI companies left willing to insure Investment Property transactions. Due to these recent changes by all of the MI companies, there are no lenders who are able to accept any Investment Property loans with an LTV greater than 80% regardless of the investor guidelines, unless you already have an acceptable MI certificate from an MI Company in hand. Until further notice from all the mortgage insurance companies 80% financing on investment properties is the MAX.
Through tightening guidelines and reduction of loan programs we have already seen these restriction affect potential primary homeowners. The real estate market will further be hurt by restrictions on well qualified investors who believe in the old adage of not putting all your eggs in one basket. Dave Ramsey likes diversifcation to cow manure. If you let manure sit in a pile, it stinks, but if you spread it around, it makes things grow. Love it! On a side note, he also believes if a minimum 20% downpayment, but prefers CASH). Savy investors who want to spread it around will have to be selective. It seems as though the real estate market is being punished by not being able to get rid of inventory. Don't get me wrong. Guidelines needed to be changed. It's a shame that the pendulum has swung from one extreme to the other. The mortgage industry has got to find a happy medium of lending guidelines. Would be homeowners have to get back to the basics and save money for a sizable downpayment. Banks have learned their lesson with the 100% financing craze and there will not likely be a return to those days. How will the loss of MI on investment properties affect the real estate market?
Michele Reneau - Military Relocation Specialist with Carolina One Real Estate in Charleston, SC.
Contact Michele Reneau, Realtor®, North Charleston, SC Relocation Expert, CRS, GRI, ABR. Licensed Realtor® in South Carolina at 843-572-0518 to list your property for sale or to purchase real estate in Charleston, Goose Creek, Summerville, North Charleston, Hanahan, Mount Pleasant and the surrounding areas in Charleston County, Berkeley County or Dorchester County, South Carolina. The Charleston Relocation Expert specializes in military relocation, first time homebuyers and creating marketing exposure to sell your home in the Charleston SC Real Estate market. I can also be contacted by email at firstname.lastname@example.org. To view all Charleston Metro area Homes for Sale Click Here and then click on Search for Homes. With over 25 years of Lowcountry Living, I know the Charleston Metro area. I will help you get your home sold and/or help you buy your Charleston home or land.