Another thing to weigh is whether the interest rates will be as good later and if you are a first time home buyer wanting to use the tax credit that is on the brink of expiring..It is all about where your priorities are and what your needs are for when you want to own. There are reasons for purchasing now whether it has hit the very bottom or not.

Hi Mac,
Hopefully you didn't buy in March, 2008. Wait another year, save another 20% on the price. Good Luck

Good advice Anja. Lets just hope the the threat of a carrier moving from our area never actually materializes. We and the RE market will be toast if that happens on the heels of current conditions. Could you imagine another 5000+ houses coming on the market in a matter of weeks?

Things are bottoming out here in Virginia Beach in the residential market as a whole..It will stay low for a while and probably go even lower by the winter as was mentioned before. It would benefit you to start looking now and narrow down exactly where you want to live, and all of your priorities in the right fit for a home for you and that way as soon as the right price and right home surface you will be ready to act on it and not miss the opportunity to get the best investment. I would caution you not to buy anything to flip immediately unless you really research the values and know for certain it will appraise at a price that will bring you a profit..If you are looking for a home to settle into for 5+ years then you will have the best leverage overall.

Good luck!
I hope you find just the right home when you are ready..

Sincerely,
Anja Howard

Mac,

I always recommend to my clients who do not have a pressing time frame to buy in December and January. It seems that these are the months when we can negotiate the best deals. During Dec. & Jan., the sellers who are on the market most likely REALLY WANT/NEED to sell. The market is very slow during this time and the sellers seem to be more willing to look at any offer.

First, let me say, Don have a nice trip. The exchange rate on the US dollar to Euro is about $1.50 US / 1 EUro dollar, so bring about 1.5 times the amount you want to spend. If you are in London you will need $2 US / 1 GPB British Pound. If you were in London last year when the housing crisis was unfolding, you would have seen very long lines circling around Northern Rock Bank. By the way, the europeans are quite particular about standing in line--strickly single file--for example do not try to stand next to your wife in line for the theatre, stand behind her, this rule is strickly enforced at all venues.

Anways, In America, we call this a "run on the bank", not sure what they call it, I didn't ask. Northern Rock is now in govt control. The brits are hoping to "re privatize" the bank soon. The last time this happened in London was 200 years ago. The last time this happened in the US was the great depression.

Mac and Don, you remember the great depression, it was a terrible time for you and our country. Is the "pop" of the housing bubble big enough to knock down banks? I don't know, ask Northern Rock. The FED seems to be in a panic. They cut rates .75 points a few weeks ago. The Bush/Bernanke stimulus package--yes, I like the $1,200 rebate, but whats the catch? Today, the FED anounced that they will help the banks with $200 billion loans--ie the bank can use bad collaterized debt (subprime) as collateral. They are only 28 day loans, but thats enough time to temporarily get that stuff off their books--they have to report earnings in a few weeks. Why do the biggest banks in the world need help? What are they hiding?

After all that help from the FED and long term interest rates still going up? I wonder what that does to housing prices?

I see Bubble Boy's post below, he sounds frustrated. He should be frustrated, he has been priced out of the market. Cheap housing is good for everyone.

Don and Mac, no offense, but you sound smug and condescending in your posts. You may be buying properties that you think are great deals. Only time will tell. Bubble boy has time.

Oh Don, enjoy your trip to england. When you get back your recent purchases will most likely be worth less. I saw that some of the major US lenders are starting to require 25% down payments. That should go well for liquidity of housing. I'm still somewhat young and make a salary that I am happy with, but I know that my job could go away with little notice. In the new economy it's best to be able to mobilize really fast. Of my friends who are all local, and in one of the best fields (high technology, computer security, etc) I'd say I've seen 3 people mentioning Northern Virginia / DC area. Our friend who is relocating from Cali to Norfolk (gets to keep his Silicon Valley salary grrr) is renting because he even said Raleigh and Northern Virginia have better jobs. The jobs in HR aren't really rewarding, so many of the high income tech people (that are worth anything) are mostly looking at moving. The people the are left behind are generally not good at their jobs and make it worse for those that are. I think this hurts HR pretty big time as well. You can gloat over the one high home values, but in the end there ain't going to be anyone around to buy. Young people don't like it here. The only thing the region had going for it was low cost of living. Old people might come to visit but NC has cheaper taxes when it comes to retirement (Florida priced themselves out temporarily).

What do you have to say about this Ms. Davis?

Maggie Davis - it IS a Realtor sales line. Your reply is non-sense realtorspeak. It is BETTER to pay a higher interest rate with a lower price versus the opposite. Higher interest rate + lower home price means more tax writeoff, it means more chance of refinancing later, it means a lower cost on the home should you want to pay it off early, and it means all your other investments are likely to generate higher returns (Even though most recent homebuyers have no other investments.... some of us renters do! LOL).

You should NOT buy.

Market timing doesn't work. There is no bell at the bottom.

So my suggestion is that you NOT buy until you are ready to own a home for at least 5-7 years. At that point it won't matter what month you bought in.

Frank

I don't know if it's true or not, but I guess we'll know in the fall, won't we?

Hi Mac,

Interesting thought. Depending on where you are in the country, it appears that some people will have it worse than others for the next few years. It may take that long for this market to really change. For others it doesn't really matter much, they know when to buy and when to sell. I believe with the elections coming and the government trying to do some good (albeit not much)... we may see some stabilization of the market. Either way...., those in the know will profit, when seller must dump properties cheap we buy. When its a bullish market and sellers are getting top price...., we sell. - Funny how that works. ;)

I began buying to rent some properties, selling and flipping other properties 30 years ago. In the past 12 months we have personally bought 4 homes and a duplex, plus in the past 24 months we have sold 52 homes to the public. I am keeping all these properties I just bought. All are rented out and we are in the black on every one of them. When the market changes, and it will... we will have some great equity to resell a few.

Now..., as Paul Harvey would say, here is "... the REST of the story."

The buyers who are "waiting for the bottom to drop"... thinking things will get cheaper, .... just be aware that it can backfire. You could be right, but more than likely not. Its like the price of gas or milk, do you see these prices going down anytime soon? Probably not. --- We have a 24 hour Market Watch as part of our local MLS.... this morning it showed 58 homes sold in just the last 24 hours here. Buyers like me are snatching up the good deals and will grab up more if they pop up in the summer or fall. Jump in, the water is fine if you can swim. Just don't count on selling anytime soon.

Just my 2 cents worth.
Best regards,
-Don

PS; Gosh... I sure love this business. I will be in Europe for two weeks in August, it will be interesting to see how the market and buyers are reacting when we get back.

Prices are one thing, and interest rates are another. Long term rates (mortgages) have gone up since early February, wiping out lower prices pretty effectively. A .5% increase in interest rate wipes out a 5% reduction in loan amount!

I know this sounds like a real estate sales line, but this is a great time to buy! Please check out my Top Ten Reasons to Buy Now at the link below, and best wishes.