EVERYONE is waiting for the bottom to come and uncertain amid all of the conflicting information out there of WHO knows for sure when that will be...
DLS at CBALM Manistee Mi. 49660

Today's buyers are no different the you and I.........

They are waiting for the great deal to become even better.

Derek, it's so much more complex than just supply and demand though. Prices depend on economic situations, interest rates, credit availability, etc. These prices are not historically low...just the lowest we've seen in the last 2 years. Home prices are still higher than ever seen in history.

Hi Ed and Cindy -

Thank you for your response. That is so nice to hear that Michigan may be on the rebound. In fact, I was talking with a lender yesterday who indicated that there was only 3 or 4 cities in Michigan that were still a declining market. All other Michigan cities are either stabilized or on the upswing. Thanks again and we hope you have a great end of 2008!

As an agent here in Macomb County, NE of Detroit, we are not seeing buyers wait, we have not been this busy since 1997-1999. Actually starting to feel the market may be on a rebound soon. Seeing tons of mutiple offers not only on the bank owned but also with our private sellers.

We saw the signs coming when it went from a sellers market to a buyers market in June of 2001 and it happened quick. Feeling the same now.

I respectfully disagree. Prices are by and large affected by supply and demand. The supply still needs to come down, but conversely the demand is on the rise given the historic low prices.

We are in a historic period, for sure. Good luck to you and to us all...

Nonrealtor, thanks that was a wonderul book! Too funny!

Derek, I think interest rates WILL go up. When that happens, the prices of homes will continue to drop further and further, because they will need to adjust to maintain affordable monthly payments for prospective buyers.

I've included an example below of what I mean:

Monthly payment: 30 Years
Interest rate: 6.000%
Loan amount: $ 300,000.00

$ 1,798.65 a month

Monthly payment: 30 Years
Interest rate: 10.000%
Loan amount: $ 205,000.00

$ 1,799.02 a month

If interest rates go from 6-10%, which I believe the will in the next 4-5 years, than the same home will naturally depreciate by about 30% in order to stay fundamentally affordable compared to buyers' income levels.

I'm sitting it out until interest rates go up to these levels, because interest is the tax deductible portion of mortgage payments, as well as the fact that I can always refinance for a lower rate once interest rates come down again in years to come. I won't, however, be able to refinance the principle that I paid on the house in order to get a lower principle balance.

Wait another year, save another 20K. Who wouldn't wait. It's like making money and you don't have to do anything but wait. I saved 40K this year by waiting. If you amortise that over 30 years at 6.5%, I saved $91,397. That could be a new book. How to make 100K in real estate in just 1 year. It would be a 1 page book.
Page 1

WAIT

The end

The issue, I find, is that people are so uncertain about values and are they going to continue to fall. Well, they surely may a little bit, but by most indications rates may go up, so financing a slightly higher sales price, at a much higher interest rate, only costs more in the end.

THE TIME TO BUY IN MICHIGAN IS NOW, FOLKS!!!!! MAKE NO MISTAKE ABOUT IT!!!!

California is slow too. Lots of folks are broke but some are just waiting for the Joneses. Things will turn around, just a matter of time.

It's the same down state. Don't worry...it will pick up. Let's weed out some of this foreclosure inventory (the garbage stuff) and get back to the basics. We'll all be just fine.