Will the Housing Bubble Burst?
HouseMaster® president and CEO suggests a professional home inspection can protect buyers from making a bad investment in today`s fiercely competitive market
Bound Brook, NJ; May 31, 2005 —As home sales hit record highs, mortgage rates remain low, and real estate is often selling for much more than its asking price, buyers need to remain cautious and invest wisely, says Kathleen Kuhn, president and CEO of HouseMaster ®, the most experienced name in home inspections. “The housing bubble is less likely to burst as it is to just simply float along,” Kuhn predicts. “In other words, home prices won`t tumble, but they can`t continue to appreciate at the current pace. Buyers need to proceed cautiously and protect their investments.” Over 100 U.S. cities have seen home prices soar as high as 45% since last year ( USA Today). So what does that mean for a buyer who is looking to purchase in today`s market?
Kuhn suggests, “It`s time for buyers to get back to the basics of real estate: location, location, condition . A home in a great location will be a good long term investment, even if housing prices dip. But, the key to a good investment is to make sure a home is not fraught with costly defects.”
The National Association of Realtors says that 98% of realtors strongly recommend a professional home inspection, but in the current hot seller`s market, not all buyers are following that advice. In an attempt to make their offer the most appealing, buyers may consider dropping their home inspection contingency.
“This can be disastrous for a home buyer, particularly if the home is over- priced,” says Kuhn. And, in fact, a realtor can be putting themselves and the home seller at risk for a lawsuit after the sale has closed; according to the NAR, most lawsuits against realtors are initiated by buyers over non-disclosure of hidden defects.
What`s the solution? “Buyers should never forgo a home inspection. That`s the bottom line. There is just too much at stake,” Kuhn advises. But sellers can be proactive too and get a home inspection themselves. “We are seeing a growing trend of sellers in hot markets getting home inspections before they put the house on the market. They don`t fix much, because they don''t have to, but at least they have the peace of mind that their buyers know what they are getting into and they won`t face non-disclosure issues down the road.”
About HouseMaster:
HouseMaster has franchises in more than 370 cities in the U.S. and Canada . Each franchise is an independently owned and operated business. Collectively, HouseMaster has performed nearly 2 million inspections since 1979. For more information about home buying and inspection, visit www.housemaster.com or call 800.526.3939.
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