The real estate market and the mortgage industry has turned upside down as our economy is spiraling downward which we haven't seen seen in decades.  In this depressed economy, some of our loans on our homes exceed the actual value on the market.  The prices of residential real estate are so depressed, hitting an all time low since 1980 that some experts are forecasting that we are headed into a recession.

 Just this last February, it was noted that the prices were dropping at such an alarming rate that the slump did not look as if it was easing up but instead gaining speed. The Standard & Poors/Case-Shiller housing index for prices using over 20 large cities in the U.S. dropped almost 13% in one month in comparison to last years figures.  A good number of these 20 cities are stating that it is a decline they have not seen in over 30 years.

Developers are filing bankruptcy and homes have been left uncompleted and unoccupied and even those companies that were looked upon as the more established builders have stopped building or slowed down to a survival crawl.

Thus, the supply is smothering the demand in the residential market, and foreclosures are running rampant either due to loss of employment or the increase of adjustable rates on existing mortgages have pushed owners right out of their homes due to not be affordable financially.

In the political arena, many refuse to acknowledge outright that all of this forecast as a recession, the Federal Reserve continues to lower the interest rates in what appears to be an attempt to lower and keep the loan rates more affordable and attractive for future buyers.  Refinancing has become a main staple for mortgage lenders to try and stay afloat themselves.

So you may ask yourself, what could this possible have to do with you? It's a moment to cease excellent real estate buys and turn them into great investments.

Look for areas that have low unemployment as well as visible increase in the population.  Business's opening and prospering and improvements being done to the neighborhoods is a good sign that investing in that area may bring about long term growth for your purchase.  Plan to keep your properties for a while, long enough to gain some equity as the market grows and prices increase.  Keeping in mind that you should also have cash that flows positively so as to cover all your expenses over the long haul while you await the market recovery.

If you are a property owner already, it is obviously not a good time to sell for profit, but you could look into refinancing at an attractive lower rate or find a good renter and create positive cash flow till the market improves in that area enough to sell with a profitable margin.

There are many things we cannot live without, and shelter is one of them. So be proactive about your hunting for a good investment in real estate, take full advantage of low interest rates, find anxious sellers and keep your eyes peeled for foreclosures and contractors closing up shop.  These are all good pools for great deals.