To accurately compile a time capsule of the American zeitgeist circa 2011, one would have to document the obsession with the Royal Wedding (particularly, Pippa Middleton’s posterior), that other nuptial-turned-divorce drama (Kim Kardashian and Kris Humphries) and Lindsay Lohan’s legal woes.
But I would vote for the inclusion of a handful of other phenomena — all obsessions of the real estate variety.
Here are six issues, questions and conundrums that have had real estate consumers (i.e., anyone who pays for the place they live) nearly as fixated this year as they were on the Arnold Schwarzenegger-Maria Shriver split:
1. Interest rates — how low will they go? American homebuyers and homeowners alike are completely fixated on interest rates, which have fallen to the low- to mid-3 percent range, and stayed in that neighborhood much of the year.
Homeowners who are stuck in upside-down mortgages (owing more than their homes are worth) have practically salivated after super-low rates all year, while buyers and refinancers have suffered through days, even weeks, of breathless anxiety about the possibility of locking their rates too soon.
2. Tricks to fix missed mortgage payments. If I had a dollar for every time someone called or emailed me to ask what special tricks I have up my sleeve to help them resolve the issue that they’ve fallen behind on their mortgage(s). I tend to offer up the loan mod rollercoaster in some cases, short-selling or applying for a deed-in-lieu of foreclosure in others, and bankruptcy as a last resort in still others.
And generally, I get push back — that won’t work for thus and so reason, the other won’t work because of X, Y and Z. So, it recently occurred to me that many of these folks are looking for a trick — a workaround to keep their houses without having to go any of these routes.
Unfortunately, the only surefire way I know of to "fix" a delinquent mortgage and keep the home with minimal credit damage is to take a second (or third) job, cut back on expenses, and catch up on the payments.
3. Real estate remorse. Buyers fear they’ve paid too much. Sellers fear the buyers have paid too little. The relatively few homeowners who have gotten their home loans modified wondered if they could have negotiated harder and gotten their mortgage principal reduced or a lower payment.
Those who’ve lost homes involuntarily wonder if they might have been able to do something to save their places; those who’ve walked away wonder if they made the right move. And any and everyone who has locked in an interest rate on a home loan, then noticed that rates kept dropping, has spent the time since wallowing in or at least occasionally visiting the land of real estate remorse.
4. Walk away or stay? The second-most frequently asked question that hits my inbox is whether or not the writer should stay put in their deeply upside-down home, or should walk away from it, strategically defaulting on their mortgage.
There is no one-size-fits-all answer to this question, as many of the people who think they are facing the issue of strategically defaulting cannot, in fact, afford to stay in their homes and so are actually debating what seems like a decision but is actually an inevitable road to foreclosure (at worst) or short sale (at best).
5. Rent or buy? While you’d think low, low prices and matching interest rates would send prospective homebuyers into the market, searching for deals, the fact that home prices have hit double and even triple dips in some areas has actually caused more homebuyer fence-sitting.
On top of that, the whole nation is experiencing real estate PTSD (post-traumatic stress disorder) — feeling the trauma of knowing people who have lost their homes, which makes everyone much more conscious and intentional about avoiding that same trauma.
Oh yeah, and the job market has continued to lag most of the year, making even employed people hesitant to lock in large, long-term financial and geographic commitments. Accordingly, the issue of whether to rent or buy has gone from being a normal life progression to an obsessive worry and subject for months, even years of vacillation for some homebuyers.
6. Bizarrely high- and low-priced homes. Stories about celebrity real estate and uber-luxe home sales, like Petra Ecclestone’s $80 million cash purchase of Candy Spelling’s Hollywood home, have been some of the hottest housing market stories to hit the "interwebs" this year.
But Americans are similarly fascinated with properties at the other end of the price and square-footage spectrum — the story about the New York architect who lives in a 60-square-foot apartment and the multiple headlines about Detroit homes going for $5,000 or less (even free!) have also held the interest of real estate readers this year.
What real estate stories held you enrapt in 2011?
Tara-Nicholle Nelson is author of "The Savvy Woman’s Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.
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