The real estate market has not gained any momentum in 2008 despite record low interest rates. Through the first quarter of the year almost all reports from real estate agents would categorize the market as still being soft. There is speculation that more foreign investors will be coming into the U.S. to purchase property as the value of the dollar continues to fall in conjunction with home prices. This represents only a very small lift to the present housing market.

We can speculate that new home buyers are remaining cautious for a number of reasons:

* Expecting home prices to continue to decline into 2009

* Nervous about their employment status in the tough economic conditions we are in

* Lack the funds for a down payment in today's tougher lending environment

* Scared to move forward based on all the negative news regarding the economy and real estate

The real estate market will struggle to rebound until more first time home buyers begin to purchase the excess inventory within the system. The government is rumored to be working on some solutions through FHA to help assist new home buyers and provide further incentives to purchase foreclosed homes. This is a critical step to help fix an ailing market.

4-21-2008 ©LowRateMortgage.com

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