So if you can afford a large down payment, I say buy. But make sure everything in your life is stable right now and plan to buy a home to stay in at least 5 years. Remember the cost to sell a house is over 15% these days, so your house needs to increase in value 15% just to break even on what you put into it. Most agents don't even know about this cost to sell. So if you've got the cash go ahead and buy for your own stability. Rents will most likely decline when the market keeps softening, never try to time the market, just buy when it makes sense to you in the long run.
Home prices in our area will drop slightly or remain stable through 2011 at least as a best case scenario but are forcasted to drop another 5% or so in VA Beach. So the bottom line is that you are not facing any rush to buy currently. The current RE market reality is that this is going to take 5 years or more to work through, not months or even a few years.
Also, if interest rates rise, home values decrease proportionately, thats just the way the market works. It's the same with the tax credit to some extent too, as soon as the credit goes away, the sellers are going to be faced with making more concessions to make a sale. As far as the interest rate rise scare tactics used by realtors, that is just plain non-sense with the current government administration. Does anyone really think the Obama administration would allow another death blow like increasing interest rates to happen with the RE market still on the rocks? Not a chance.
Anja below gave an example of what you might get for your money. Do you think you can find something you really like in a $1,000 monthly payment range? If so, it wouldn't hurt to start looking. Be realistic on the area and home you want, prime locations in our area still cost quite a bit to own.
Drew, you always have the educated and honest answers.
I wanted to ask you a question based on Non's response. First let me say that in the past 6 months we have seen prices dropping in this area and it may continue for a while longer. Here is my question:
Should prices continue to decline on the homes in the price range that you are looking at, perhaps another $10, $20 or even $30,000 but the interest rates increase from 5% to 6.5%, would you consider that purchase a better deal than purchasing a home now? I suggest you crunch some numbers or even ask a loan officer to give you different scenarios based on different prices & interest rates. That way you will be able to choose the option that best meets your needs. I think you will find that everyone in the real estate industry agrees that interest rates will increase significantly by the summer. Of course, no one really knows the future so it comes down to how much you are willing to gamble. Good Luck :)
I have to say that I agree with the other answers you have received so far. No one will know when we hit "the bottom" until we look back once prices start to rise again. Our area, Hampton Roads, has been sheltered from the severe market drop that some other areas around the country have experienced. Because there are quite a few homes available, sellers who want to sell have lowered their prices. Lower prices along with historically low interest rates make owning a home very affordable. oO course you may qualify for one of the homeowner tax credits which will be an extra incentive to purchase along with the tax benefits you will discover that homeowners receive that renters cannot. All in all I can't think of a single reason NOT to purchase a home right now unless you are not able to qualify for a loan.
I would love to help you find a home that meets your needs. Please contact me if I can be of assistance or visit my website to check out all available homes in the Hampton Roads area at BarbaraTerranova.com
In response to your second question-
"Is it better to rent Vs. buy in this current market condition in VA Beach? I pay almost $1110 on rent."
I just sold a nice home that was biking distance to the beach with no association fees and was previously a yearly rental property at $950/month for $155,000! This was a great buy with a positive cash flow opportunity for an investor or second home. The tax credit is still available as long as you close by the end of June for 1st time and existing homeowners and as long as you wait at least three years to sell it that is money you don't have to pay back. While interest rates and home prices are still low why would you not want to buy?
Candy C. Dennis
Sales Manager, Long and Foster Realtors
I love the picture. I have a Yorkie too. The interest rates and prices are very low right now. It is anticipated that the interest rates will go up soon. Now is the time to buy to take advantage of the $8,000 tax credit. You need to be under contract by April 30th. Contact me today and we can get started...RobinSellsHomes@cox.net
As many experts will tell you, no one knows where the bottom is. The only way you really know we have hit bottom is when it starts to come back then you have missed it. Interest rates are great right now and even if the home price comes down a little more and you have to pay a higher interest rate you may still lose out in the long run. A home is a longtime investment and now is a great time to become a homeowner.
Let me know how I may help you,
Nelene Gibbs, Realtor
William E. Wood & Assoc.
mail to: email@example.com
Sounds like you know where you want to be, but if you let me know bdrms, bths, sq ft, price range or even subdivisions I would be happy to send you some homes that are on the market. You can also check out my website to search the MLS on your own: http://rick.bluskyyrealty.com
Have a great day!
Blu Skyy Realty
2622 Southern Blvd., Suite 103
Virginia Beach, Va 23452
Cell (757) 572-0672
Jennifer Bryant, Assoc. Broker
The Real Estate Group
I can demonstrate this to you , and show you many homes available in Virginia Beach.
Rose & Womble Realty