One thing that is clear in today’s marketplace is the shifting landscape in how real estate purchases are financed. It’s no secret that lending policies have tightened during the past several years. The result is an influx of all cash transactions.
So far this year in Incline Village Real Estate: 64% of all condos and 28% of all homes, have been cash transactions. That means collectively over 51% of all sales in Incline Village have been paid for without the use of a lending institution.
The lending industry’s policies have an enormous impact on the growth and decline of real estate markets. We’ve witnessed this first hand during the past decade. Six years ago it seemed almost anyone could get a mortgage. Today it’s a different story. The lending policy pendulum has swung in the other direction. Until we see lending policy find a “normalized” balance, we believe price growth will be somewhat limited.
That’s not to say there aren’t some great deals in Incline Village. One need not look very far to find a great opportunity. Our suggestion is that until lending policy loosens up a bit, we won’t see the massive price leaps we saw during the 2000’s.
Have a wonderful week!
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