Everyone is asking what the market will be like in 2010. Will prices stabilize? Will low rates and tax credits be a mainstay for buyers? What role will foreclosures play? ...and so on.

If you look back on previous articles starting last winter, the trends for 2010 were already set in motion. The same message is still clear. Let´s see whats reinforcing it now.

It´s important to understand what exactly is in store for the real estate market. Buyer demand is extremely important to keeping home values from dropping further. The higher demand is for home purchases, the more valuable homes will be.

One of the things that are helping real estate market sales is the tax credit for home buyers. Right now through April, 30th, 2010, buyer activity will continue to be higher because home buyers have access to up to $8000 in tax credits. This tax credit is helping homes maintain some value continuity.

From the graphic you can see that after the tax credit ends, there is nothing to help the real estate market maintain value or slow decline. Right now, buyers are looking. This is very important to remember.

Now note the graphic that shows what´s in store for price rebounds throughout the country.

As a homeowner myself, I could easily shrug my shoulders and think that a graphic is meaningless, and think that the real estate market is on the rebound already. I wish that were the case. But wishful thinking isn´t what helps people understand what´s happening with the market. Insightful analysis is what will help a seller make an educated decision about selling their home.

I´ve brought this point up in past articles, but since repetition of information is the mother of affecting mindsets, here it is again. Our federal reserve system has been artificially supressing mortgage rates for months now. The slide clearly shows that stint is abruptly coming to an end. When rates spike up (and they will) it will be harder for buyers to buy. The following article makes this subtle point.

http://www.businessweek.com/lifestyle/content/dec2009/bw2009127_753974.htm

I refer you to this article because it is a lapel grabbing concept. When a buyer maxes out on affordability, a home can no longer be bought.

Guess what else sellers? If it´s harder to buy, then it´s harder to sell also. Definitely for the same price that you can get now.

If that wasn´t enough let´s talk about foreclosures. Yes again. The slides above and below talk about cure rates, which represent delinquent borrowers who recover and re-establish current mortgage payment status. The difference is astounding between todays cure rates to those of four years ago, and even from 2008-2009. Why so drastic? How about massive unemployment? Increased real estate and other expenses, etc.

What does this translate to? It´s really time to take action folks. It is still not too late to wake up and smell the coffee before it financially burns you.