short sale, foreclosures and short sales People are getting back in the market to buy foreclosures and short sales, but they should do so carefully now. Fannie Mae and Freddie Mac passed a new rule that only lets a person carry four mortgages at a time, so for those who can afford real estate investing as a career, this is a really serious blow. Some investors have dozens of properties, but as of December 2008, that will all change. It will be months to see what this rule does to the volume of sales transactions in foreclosures and short sales, but it's likely it will put a damper on the market.

Foreclosed homes and short sales make good investments because they are often purchased at prices below market. They are good purchases for people wanting investments, but can be tricky for home buyers to acquire because of the longer time it takes to buy them. The paperwork can get dragged down at the bank, and although the bank wants those foreclosures and short sales off their books, they may not have the staff to execute the paperwork as quickly as home buyers, versus investors, want it processed.