They didn’t use crystal balls, but a handful of key real estate players from the Lincoln Park Builders of Chicago nonetheless sought to predict the future at a recent forecast panel. Don Debat, a columnist for New Homes Magazine, reports on their prognostications in this month’s issue.
Although interest rates are extremely affordable, the fallout from the subprime mortgage crisis has caused the nation’s mortgage industry to go through a “state of siege” and that likely will last two more years, said mortgage broker David Hochberg of Townstone Financial.
“Over the last five years, the residential lending market was like the Wild West,” Hochberg said. “Now, 6-percent home-loan rates are available, but many lenders are not approving loans. No-doc loans are out, and lenders are saying that mortgage applicants with a credit score in the low-500s seeking a zero-down payment loan will be rejected.”