You can follow Rent vs. Cost to own and Case Schuler Indexes but being a novice I believe these "useful metrics" might make your head spin. Just learn the Real Estate Basics and you will be fine.
Mike Gallagher, Real Estate, Inc.
Principal, Grayslake Advisors
Lecturer, UCLA Anderson School of Management
My name is Mike Gallagher. I own my Brokerage: Mike Gallagher Real Estate, Inc. You can see exactly by full color graphs where the peaks and valleys are for Real Estate in Hawaii.
Go to my website at: http://www.hawaiirealestatestatistics.com It is there you will find the latest information on exactly what is happening in Hawaii Real Estate with the use of graphs and Real Estate Articles.
You may also want to read my monthly articles at Oceanic Cable http://www.aroundhawaii.com under "Real Estate."
It is better to buy at the bottom of the market than at the top. The trouble is that for the majority you will not know the bottom has it until it is past the bottom and heading upwards. "Experts" try and try to predict these bottoms but are rarely successful.
Buying just before the Median Price bottoms is not a bad idea but you have to know when this is. That is the hard part but my articles and graphs will help you do this.
If you have anymore specific questions after visiting my site I will be happy to help answer them. You can reach me almost anytime.
Mike Gallagher Real Estate, Inc.
If I can help you find anything or answser questions about property on Maui, please let me know.
Mahalo, Carol St. John
Maui Showcase Properties
IF (as in capitalized if) oil prices come down to a reasonable level, AND food prices stabilize, AND we don't have any major economic catastrophes, AND depending on the price of rice in China, interest rates will rise, stay the same or decrease (yes, I could be an economist)). Every time oil prices jump, the Fed is under pressure to raise interest rates, because everyone has to spend money to pay for gas to get to work. As of now, everyone is spending instead of saving. Banks have to pay more for deposits too. I think we are in an oil bubble now, but that's a sticky topic (sorry).
My point it that a 1% increase in rates will affect your buying power by between 5 and 10%. So, that $400,000 condo at 6% now with 20% down (~ $2100 per month), now costs 10% more 12 months from now with an interest rate of 7% (~ $2300/month) . Find a mortgage calculator and see.
On the other hand, more bad news in the housing market will cause more inventory backlog and prices will have to decrease, since less of us will qualify to buy! It's a big mess.
I always tell people the same thing when they ask me when they should buy: "When you can afford it."
Yes, you can wait and the rates may increase or you can buy now and the price of the home could decrease. Will home prices drop by 10% or will the rate go up by 1%? Call your agent as soon as you know, because I don't know. The interest rate is the big IF. Learn as much as you can about your local market. Talk to your friendly neighborhood Realtor. Get qualified by a loan officer. Be ready to move and when you feel comfortable, get your best deal.
Besides, median prices are misleading, especially in the aggregate way they are reported, when it comes to properties as diverse as the ones in our area, don't you think Diana? I always prefer to look in more detail at the comps for a particular property...then using the number of active listings versus the current level of demand we have a much stronger indication of which direction the next sales are headed.