Top 6 Real Estate Obsessions of 2011

To accurately compile a time capsule of the American  zeitgeist circa 2011,  one would have to document the obsession with the Royal  Wedding (particularly,  Pippa Middleton’s posterior), that other nuptial-turned-divorce  drama (Kim  Kardashian and Kris Humphries) and Lindsay Lohan’s legal woes.

But I would vote for the  inclusion of a handful of other phenomena — all  obsessions of the real estate  variety. I usually contact experts if I need some help with real estate properties.

Here are six issues, questions and conundrums that have had  real estate  consumers (i.e., anyone who pays for the place they live) nearly as  fixated  this year as they were on the Arnold Schwarzenegger-Maria Shriver split:

1. Interest rates –  how low will they go? American homebuyers and  homeowners alike are  completely fixated on interest rates, which have fallen to  the low- to mid-3  percent range, and stayed in that neighborhood much of the  year.

Homeowners who  are stuck in upside-down mortgages (owing more than their  homes are worth) have  practically salivated after super-low rates all year,  while buyers and refinancers  have suffered through days, even weeks, of  breathless anxiety about the  possibility of locking their rates too soon.

2. Tricks to fix  missed mortgage payments. If I had a dollar for  every time someone called  or emailed me to ask what special tricks I have up my  sleeve to help them  resolve the issue that they’ve fallen behind on their  mortgage(s). I tend to  offer up the loan mod rollercoaster in some cases,  short-selling or applying  for a deed-in-lieu of foreclosure in others, and  bankruptcy as a last resort in  still others.

And generally, I get push back — that won’t work for thus  and so reason,  the other won’t work because of X, Y and Z. So, it recently  occurred to me that  many of these folks are looking for a trick — a workaround  to keep their  houses without having to go any of these routes.

Unfortunately,  the only surefire way I know of to “fix” a delinquent  mortgage and  keep the home with minimal credit damage is to take a second (or  third) job, cut  back on expenses, and catch up on the payments.

3. Real estate  remorse. Buyers fear they’ve paid too much. Sellers  fear the buyers have  paid too little. The relatively few homeowners who have  gotten their home loans  modified wondered if they could have negotiated harder  and gotten their  mortgage principal reduced or a lower payment.

Those who’ve lost homes  involuntarily wonder if they might have been able to  do something to save their  places; those who’ve walked away wonder if they made  the right move. And any  and everyone who has locked in an interest rate on a  home loan, then noticed  that rates kept dropping, has spent the time since  wallowing in or at least  occasionally visiting the land of real estate  remorse.

4. Walk away or stay? The second-most frequently asked question that  hits my inbox is whether or not  the writer should stay put in their deeply  upside-down home, or should walk  away from it, strategically defaulting on  their mortgage.

There is no  one-size-fits-all answer to this question, as many of the people  who think they  are facing the issue of strategically defaulting cannot, in  fact, afford to  stay in their homes and so are actually debating what seems  like a decision but  is actually an inevitable road to foreclosure (at worst) or  short sale (at  best).

5. Rent or buy? While you’d think low, low prices and matching  interest rates would send  prospective homebuyers into the market, searching for  deals, the fact that home  prices have hit double and even triple dips in some  areas has actually caused  more homebuyer fence-sitting.

On top of that, the whole nation is experiencing real estate  PTSD  (post-traumatic stress disorder) — feeling the trauma of knowing people  who  have lost their homes, which makes everyone much more conscious and intentional   about avoiding that same trauma.

Oh yeah, and the job market has continued to lag most of the  year, making  even employed people hesitant to lock in large, long-term  financial and  geographic commitments. Accordingly, the issue of whether to rent  or buy has  gone from being a normal life progression to an obsessive worry and  subject for  months, even years of vacillation for some homebuyers.

6. Bizarrely high-  and low-priced homes. Stories about celebrity real  estate and uber-luxe  home sales, like Petra Ecclestone’s $80 million cash  purchase of Candy Spelling’s  Hollywood home,  have been some of the hottest  housing market stories to hit the “interwebs” this  year.

But Americans are similarly fascinated with properties at  the other end of  the price and square-footage spectrum — the story about the  New York architect  who lives in a 60-square-foot apartment and the multiple  headlines about  Detroit homes going for $5,000 or less (even free!) have also  held the interest  of real estate readers this year.

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