Are the banks finally casting all the demons into the swine?

You know the story, in the gospels (Matthew 8, Mark 5, Luke 8) Jesus meets up with a man possessed by many demons...a legion in fact. And then the demons beg Jesus for Him to cast them into the swine; which He does and then once the swing or possessed by the demons they consequently run off the cliff and drown in the water.

In the case of the housing market it looks like this:

The banks = the demon possessed man

The bad loans and bank-owned real estate = the demons...the evil spirits

The swine = the residential housing market

In case you haven't seen or heard the news: The banks repossessed more homes in August 2010 than at any other time...up 3% from July and up 25% from a year ago. That's bad news! But here's the kicker, LESS THAN 1/3 OF REPOSSESSED HOMES ARE ON THE MARKET!

So if bank repossessions are climbing and less than a 1/3 of current repossessed homes are on the market, what do you think the banks will be forced to do? Answer: At some point in time...coming soon to a housing market near you...At a faster and higher rate, the banks will start casting out their unclean mortgages that end up taking the form of bank-owned real estate and send it into the residential housing market. And when a greater number of homes enters the housing market, the market could very well run off the cliff and drown.

Check out the following articles:
U.S. Homes Lost to Foreclosure Up 25 Percent
Home Price Double Dip Begins
Bank Repossession of Homes Sets New Record in August
U.S. Home Prices Face 3-Year Drop as Inventory Surge Looms

"Once you reach a bottom, it will take three or four years for prices to begin to rise 1 or 2 percent a year."

"The best thing that could happen is for prices to get to a level that clears the market," said Shapiro, who predicts prices may fall another 10 percent to 15 percent. "Right now, buyers know it hasn't hit bottom, so they're sitting on the sidelines."

For an excellent article on "What Real Estate Recovery?" check out this excellent article from Franklin Sander a.k.a. The Money Changer.

Now when it comes to making a decision about whether to buy or sell, never base your decision on solely what the national market is doing. You must know your market. Some markets are and will remain stable, but many markets will not. My advice, wait another 2-3 years. If you have to buy now, then do your due diligence and find a deal at 25% under current market value or more. Current market value includes factoring in what foreclosures and distressed properties sell for.

Oh! And some good news...now is excellent time to start saving your money to buy a home 3 years down the road. You may even want to invest some money and time into taking some courses at your local technical school or community college on home wiring, plumbing and carpentry. That way, you will be more open to buying a home that you can fix up and gain some equity in right away.

As a Christian, you need to be wise with the resources that God is giving you.

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