The prices are affordable again and the interest rates are reasonable too. The only problem is at the entry level price point, First Time Home buyers and Investors are competing for the same properties. So you have an investor that comes in with all cash and usually beats out the First Time home buyer unless the First Time home buyer offers substantially over asking price.
This is driving the prices up. So, anything that is priced well is receiving multiple, multiple offers and usually sells for over the asking price. This pressure is pushing the prices upward. The entry level price point is extremely active right now.
The majority of the homes for sale now are REO/Foreclosure properties and the Seller doesn’t want to fix anything. The FHA loans require the home be in decent shape and the stove, heater, air conditioners and other appliances to be in and working. Some of these homes have been stripped of the appliances making it difficult to obtain an FHA loan. Most of the First Time Home buyers right now are FHA buyers.
So, if you are in the market for your first home and are writing offers and writing offers you may have to increase your offer price to beat out these Investors.