Unemployment Rises Above 10%, What This Means For Short Sales Opportunities?

The United States Department of Labor reported in Oct 2009

, that the unemployment rate had gone up to 10.2%, up from 9.8% the previous month. It was previously projected by analysts that unemployment would not reach over 10% until 2010.

How does this information have an affect on short sale opportunities? Well, quite simply, it is a sign that more homeowners will default on their home mortgages and will need to resolve their obligations to the lender by performing a short sale on their property. Yes, there is an argument that a lot of these recently unemployed people do not own homes, but it is likely that many of them do as the loose lending guidelines allowed so many people to purchase homes with little to no money down. Many homeowners were buying multiple properties, overextending themselves, when in fact based on their salary, they couldnt even afford one home.

The fact is, the more jobs that are lost, the less income people will have, which in turn means less consumer spending, which means, business will be hurting and the vicious cycle continues! People who are unemployed cant even try to save their home due to the fierce competition in the job market. Its not even an option to take on two jobs to make the mortgage payment, its just that there are no jobs! Even with households with multiple incomes are finding it hard to keep up with their mortgage payments.

There have been more than 8 million people who have lost their jobs since the start of the recession and now experts are anticipating the unemployment number to increase over 10.5% by summer 2010. There are a number of new jobs that have been created in recent months, but not enough to offset the number of people who have lost their jobs. It has also been reported that of the 8 million people that became unemployed since the recession started, 6 million of them were unemployed for longer than 6 months. Any of these people owning homes are sure to have defaulted on their home and are on the way to getting their home foreclosed.

Previously, we have written about the rise in unemployment going into 2010, and this is only one of the major supporting factors that in 2010, there will be a large inventory in the pre-foreclosure market. This ultimately means a huge upside for any Real Estate Professional, Investor, or Home Buyer. The message?

The time to get involved in short sale opportunities have never been so RIPE! Get off your chair and take advantage of this financial whirlwind before it passes you by. The next 5-10 years will be a long haul to a stable economic recovery!

Full Article Resourse: www.whbsolutions.com/blog/

by: Art Lee

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