Opportunity: Home Price Stabilization

It was good to see Forbes cover the recent report from Fiserv on its Case-Shiller Index. We’ve been seeing stabilization in home prices for some time. I told you about it in a podcast earlier this year.

This is an opportunity for lenders who are ready to take advantage of it. Forbes reported that the Index shows that after a record five years of home price declines, some metropolitan area housing markets are now showing signs of stabilizing. According to the story:

“Amongst those where prices have already stabilized are San Diego, Washington, D.C., and San Francisco, according Fiserv. As the year goes by, 75% of metro markets will have hit bottom and prices will subsequently stabilize. New York City, Minneapolis, and Portland, Oregon are amongst those that will join the ranks of stability by the end of this year.”

This will bring more investors back into our space that understand how the markets work and who know how to buy low and sell high. Lenders already own a lot of property in these MSAs so they’re in the best position to provide the financing to qualified investors.

I think this is just one bright spot we’ll be blessed with in 2011 and this isn’t the first time I’ve said so. But to capitalize on this, lenders need to be ready to sell and close loans. Because you know I’m the CEO of a mortgage technology firm, you know I’m going to say that technology will be critical. You’re right, because it is.

But beyond that and from an industry perspective, this opportunity will be for folks that embrace the new lending paradigm and understand that in this industry it’s not ever going to be the way that it was before.