Foreign Buyers May Soften Market's Fall

The amount of immigrants buying homes has grown significantly since the 80's. Without the immigration we wouldn't have the demand that fueled the rush in 2005. Europe seems to have a shrinking population and without immigration we may have the same problem. There is a balance in there somewhere.

In 2005 there was a report that said 42% of homes purchased were not a primary residence purchase. Many were flippers and speculators who now are in a panic to sell. These are the homes that will show a drop in the market. The people who don't can sit on their homes until it is they want to move. This is how the cycle works. We went too high and we will go to low as far as a national average.

Because we are the cheapest city on the west coast we will not feel the same drop I imagine. In the last 9 months we have has a tightening of standards which propelled some of that growth. We may not see the same ratio of immigrants. Some immigrants are weary of banks due to their home country's banking system. And because of this they don't have bank accounts or open credit.

http://realestate.msn.com/Buying/Article_bankrate.aspx?cp-documentid=5424929&GT1=10431

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