It’s true what they say. Money really does make the world go round and the lack of it can threaten to bring the world to a standstill. In recent months the global credit crunch has made banks unwilling to lend to each other which means that they have been even less willing to lend to consumers and this has led to a tightening up of the money available to do anything.

This kind of situation is exactly what can potentially bring about a recession, a shrinkage of global markets and a reversal of the progress we have made through globalization. Because the potential risk has been so great it goes without saying that the world’s greatest banks would do something about it.

Sure enough The Fed, the Bank of England, the European Central Bank and the national banks of Canada and Switzerland have banded together to put in more than $100 billion into the world monetary system.

The result of such action is a speeding up of the sluggish world economy which means that in terms of real estate the green light is back on. Real estate is a funny business because in order to work right it requires two things: new home buyers and foreclosures. New home buyers are required because they are the lifeblood of the system. Foreclosures are needed because they help keep things in control.

Foreclosures are a balancing mechanism that unlocks ‘dead money’ and puts it back in circulation, revitalizes the market and helps to create fresh supply and demand where before you had a deadlocked situation between a borrower and a lender with the only potential outcome the lender taking control of a property and spending a lot of money trying to sell it at a loss.

The credit crunch that we were experiencing was affecting man lenders and lending institutions and, in its international outlook, was stopping overseas investors from pouring in money that could jumpstart the sluggish U.S. housing market.

All this is now set to change. While it may be a brief while before we experience a really positive outlook in real estate again, 2008 looks set to be a seminal year in terms of the real estate market and foreclosures in particular.

The tightening of credit we experienced has led to a pruning of bad practices and bad lending accounts and the fall out has actually benefited the market as a whole. This means that we are now ready to turn a new leaf having learnt from the mistakes of the past and foreclosures can once again become to golden wedge helping to open up new areas of real estate and attract new home buyers into the market.