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What did we learn in the last year about the home sales market? When you look at the opportunity side for today’s homebuyer, you have to admit: the planets seem to be aligned. Prices are so low that 65% of all Californians could afford to buy a home today, according to the California Association of Realtors. On top of this, we are seeing historically low interest rates. And a buyer has the choice of a new home—currently being offered at prices that are less than replacement cost—repeat, less than it cost to build it– or a resale, a short sale or a foreclosure. So why are people still sitting on the fence? Because, it seems, we lack confidence. The 88% of the people who are employed are acting like the 12% who are not.

The biggest topics of interest to listeners and readers of The Real Story are all about foreclosure: “How do I stay out of foreclosure?” is rivaled only by “How do I buy one?” The bad news is that there’s not a clear path to success for people in either camp. Staying out of foreclosure is a much tougher road to travel than anyone ever imagined. With all of the well-meaning legislation, and all of the front-page headlines, only about a million loans were modified last year. The underlying problems are so deep that when people enter into the 90-day trial modification process, only about 20% of them are able to make their payments and qualify for the ongoing modification.

Acquiring a foreclosure? Some advice: this is not as easy as it looks. Right now the market is flooded with offers on foreclosed properties in commuter-friendly locations, both from people who want to be the owner/occupant, and the folks who want to create future wealth by purchasing foreclosures, fixing them up, renting them now and holding them until a better market makes them attractive to sell. If you are a first-time buyer, and you want to buy a foreclosure, go into it with your eyes open and a broker at your side. There are so many obstacles in the path, and so much competition; you have to be ready to make this your primary focus. If the foreclosure is too banged up, or has been looted, you cannot get a loan on it because loans are for habitable properties. If you are a cash buyer, you can play, but you are competing against individuals looking to build their net worth by owning rentals, or real estate syndicates whose business it is to pick up properties, literally a block at a time.

Are you exhausted yet? Tomorrow, let’s take on something more uplifting: how the green movement is creating healthy homes.