The current real estate market feels very much like when I first started helping people buy and sell real estate in 1991. Foreclosures are on the rise, prices have dropped significantly and everything the media has to say is doom and gloom. There is one big difference, though and that is interest rates. In 1991, a 30 year fixed rate mortgage was about 9% (and we were celebrating because this was the first time rates were in the single digits in a long time). Today you can get a 30 year mortgage for under 6.5%.

If you listen to the media, it seems like everyone is facing foreclosure, when in reality it’s approximately 2% of homeowners who are in trouble. The media knows that bad news sells. Let’s be realistic - we needed this price change. Massachusetts home prices couldn’t keep going up - we were losing population. Many students who come to the state for our wonderful colleges and universities used to decide to stay here after school, buy a house and settle down. Our high cost of housing was driving this (and many other) segments of the population away.

In the meantime:

• If you are having financial problems paying your mortgage, contact me - there are options to help you.
• If your would like to make a move to a bigger house, that makes a lot of sense in this market. Yes, you’ll sell your current home for less than you would have a few years ago, but you’ll make up for it by buying the more expensive house for less as well.
• If you’re thinking of buying, interest rates are still low, prices have come down and you have plentiful choices.

History repeats itself and the lesson we can learn from the early 90’s is that the market will eventually rebound.