The freshly-signed bill sealing the Government’s $700B bailout of bad mortgage debts will likely affect buyers, sellers and real estate agents for months or even longer. However, the buy-out should send a signal to the housing market that there will be a bottom on interest rates. When the Treasury buys mortgage securities, as indicated in the bailout plan, it has the effect of pumping fresh capital into the mortgage market. This will help your clients find more loan opportunities at better interest rates, thus reducing the foreclosure rate and helping homeowners adjust their current payments to a manageable amount.
After the bailout, interest rates should stay low, but that doesn't mean your clients will easily qualify to buy a home if their credit is questionable or if they don't have the income to support payments as before. Once we really feel the effects of the bailout, the tensions we are confronting are bound to be resolved and we should see restored confidence in the market. Bear in mind that people who are concerned about their investments are not good candidates for buying a home, even with prices at rock bottom. The bailout plan should help this quite a bit.
The good news is that with better confidence from consumers, an essential aspect of the recovery process, combined with better interest rates and lower prices it can really get the market rolling again. Perhaps houses will soon be "flying off the shelves" again.