My New Blog

The Fed took over Fannie and Freddie this last week.  What does that mean?  Well first of all we the taxpayers are now in the lending business.  Second it means that the government is going to prevent a meltdown in confidence in the home mortgage industry.  Rates went down .5% the day it happened.  So hopefully this will stabilize a very unstable situation in home mortgages.

The bad news is that pending sales fell 3.2% nationwide.  That means that buyers are not comfortable yet.  That's what I have been seeing in Northwest Wisconsin.  Many buyers are just waiting until prices come down more.  And they will if supplies continue to grow or not go down.  Maybe now that rates fell it will light a fire under a few buyers.  We'll see.  Credit is still pretty tight.

Inventories here and around the country are still too high.  In Burnett County we have over a 1.5 year supply on the market.  It is especially bad for recreational waterfront with nearly a 2.5 year supply!  Sellers must start reducing their asking prices or they can expect to hold on until next year.  And they will probably get less next year.  Also when we hit November real estate comes to a screeching halt. 

The macro information I have been reading is that this isn't going to bottom until 2010 at the earliest.  And in Burnett County it may take longer because of the nature of the market and the huge over supply.