Posts Tagged ‘Housing Crisis’

The Flip Side of the Housing Crisis, by Victor Makras

September 27, 2012

Are you still wondering what caused the housing and mortgage crisis? According to, more than one-third of the mortgages from 2006 were for second homes, and many of these houses were purchased with little or no down payment. Here in California, more than one-half of all purchases between 2000 and 2006 went to house flippers, and many of those buyers already owned three or more homes. Meanwhile, when prices fell, nearly one-third of the foreclosures in our area belonged to investors, not to owner-occupants.

What does this mean for the future of San Francisco real estate? Since lenders have tightened restrictions on mortgages, most investors have gone back to financing their properties the old-fashioned way—with cash. This means that as foreclosures leave the market, prices will recover.

About the Author:

Victor Makras serves as President of Makras Real Estate in San Francisco, California.