Apparently, everything is on sale. When it comes to real estate, affordability is near an on time high demand. Nevertheless, pending home sales are barely creeping up. So, whats stopping buyers from running out to grab up all these affordable homes at affordable rates?

Fear of forclosure. Forclosure freeze is beginning to play a role. Buyers have somewhat justified fear that if they buy a forclosed home, that sale could be reversed down the road it comes out that the banks wrongly forclosed on the former owner and that could be stopping buyer from, well, buying forclosed homes.  

Waiting for the shadow inventory to come out. The phrase "shadow inventory" refers to the home that have been (or soon) will be forclosed by the banks, which are not yet on the market. Many buyers who are actively house hunting and who are disappointed with the homes that are available, are fearful of pulling the trigger becasue they believe the banks are going to start releasing their "shadow inventory" soon.  And that those homes will be beter than what's out there on the market right now. 

Waiting for the bottom. Given the trajectory of home prices, over the past couple of years, there's a large contingent of buyers who are afraid that after they buy, home price will continue to fall and they will loose their hard-earned investment in the home. These are folks who are waiting for the botton, although by some accounts, bottom has already passed in many cities.

Human nature is always to wait too long for the bottom, miss it, and then end ups wishing we had bought sooner. The behavioral economics theory of myopic loss aversion explains this phenomenon as being due to the fact that the pain or loosing money generates greater psychological fear and avoidance than the prospect of gaining the same amount of money. Buyers can set themselves or to gain overtime, even if they lose equity in the very near term, by making smart decisions about the home they buy and how much they pay for it. And planning to stay in their home for a longer term than previous generations of buyers did.

Lets take Australia for instance. The number or the percentile of unemployed raised about 3.3% trending as of January 2011 to January 2012. On the top of that, many people who have jobs lack job securtiy, the confidence of believing they'll be able to keep their jobs in the future. Interest rates could be zero, and people won't buy homes as long as they have no jobs or job security.

Need to keep options open. Because home values are so volatile, currently, there's no guarantee that you can resell today's new home tomorrow without taking a loss, if we've learned anything from this crisis, we all know that it is just doesn't pencil, financially, to buy a home on todays market unless you plan it to own the home for years.