The business applications developer was made redundant two weeks ago, when his company shut his unit for lack of business. At least 12 people were let go. “I bought a house, hoping to be here for a while,” says Rafat, who asked the FT not to use his surname. “Who knew?”
Rafat wishes he had rented instead of buying the five-bedroom home in the Sugarland suburb of Houston. But no one predicted the crisis that has cost tens of thousands their jobs and a growing number of people their homes reports the Financial Times.
Last year, foreclosure filings were reported on 2.3m US properties, an increase of 81 per cent from 2007 and up 225 per cent from 2006, according to the RealtyTrac US Foreclosure Market Report, a leading national online foreclosure marketplace and source of foreclosure information. With economic data today expected to show the US economy in its worst shape since 1982, those losing their homes are increasingly the newly unemployed middle class.
Rafat’s real estate agent, Rubina Byramji of Keller Williams Realty, has advised him it could take up to four months to sell his home. Waiting that long in the hope of finding another job is not a risk he believes he can take, and he is considering moving back to California. “Something has to give,” he says.
The problem is that, across the nation, it is a buyers’ market. Anyone Rafat sells to will not only expect a bargain, but also that he will meet all requests for improvements on the house before they buy.
Connie Boyd discovered this when selling her home. The buyers made a string of nitpicky requests, such as fixing the vegetable sprayer on the sink so that water did not also run through the tap, reducing the pressure, when the sprayer was on. The Boyds met them all, despite feeling they were things a new homeowner should take care of. “We didn’t want to risk the sale over $1,000 in repairs,” Mrs Boyd said. “It is not unusual in a buyer’s market.”
The market might get tougher still, given Houston’s economy is supported by its heavy exposure to the energy sector, which is only now feeling the effects of plunging oil and gas prices.
Read more here: Foreclosure fear spreads to middle class