How slump in Bay Area housing market affects buyers and sellers
Monday, August 27, 2007
Selling or buying a home is more than afinancial transaction. It's a major life event, and often the gatewayto a significant transition: starting a family, retiring, transferringjobs, moving closer to relatives.
With the real estate market softening and mortgages becoming harderto get, many home buyers and sellers are stymied, unable to progresswith their plans because they cannot get their deals done.
In the Bay Area, sales volume has fallen to the lowest level in 12years. Although prices in certain higher-end communities are holdingsteady, they are decreasing in neighborhoods with a large number of newor entry-level homes. Houses are lingering on the market much longer.
But the numbers don't tell the underlying stories of the countlessindividuals who need to buy or sell a house to get on with their lives.
For sellers, a home that does not attract bids means they are unableto move. There is always the option of dropping the price, which worksbest for people who have owned their home a long time and built upsubstantial equity. But since home sellers need a new place to live,most need to extract maximum value from their house to buy their nextone.
For buyers, the uncertainty of landing a mortgage has createdanother kind of limbo - particularly for first-timers who had hoped tomove up from renting and onto the equity ladder. The reverberations ofthat inability can affect everything from commute times and apartmentleases to the accumulation of wealth and the peace of mind surroundinghomeownership.
As these stories of Bay Area home sellers and home buyers show, themortgage meltdown and real estate slump have forced many people into aholding pattern, a frustrating situation with no end in sight.
