Market Conditions in 85614>Question Details

George Davis, Home Buyer in 85614

buy now or wait even longer in hopes of house prices dropping more?

Asked by George Davis, 85614 Thu Oct 11, 2007

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13
Thumbs down bandit quite busy here.
1 vote Thank Flag Link Fri Oct 12, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
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I assume you are in a buyers market, as reports I have read about Pima, Maricopa and Pinal Counties have indicated this. The nature of your question is also telling.

Market statistics are averages and do not reflect the motivation level of the particular seller of the property of interest to you. Flexibility provides you, as a buyer, the greatest opportunity to find a great deal. While a market may be selling at an average of ‘x’ less percent compared to last year, there are sellers who will sell at discounts far deeper than that “average” number, and there are sellers who are unwilling to budge unless a buyer happens along at their terms.

If you are in search of your dream property and not willing to move unless you find perfection or near perfection, then be prepared to meet current market pricing or a sellers’ price. You might buy today, and values could go up over the next year. If prices went down slightly, but you found your dream house, is that worth it? While we don’t discount the value of investment, your home is also integral to your life and lifestyle. How might a move impact your lifestyle?

If you are flexible and willing to compromise on finding the perfect property in lieu of finding a motivated seller, start looking. There are many sellers out there now who will sell at prices below the averages. You, as a buyer, can choose your approach to the market. If prices, on average go down 3% in the next year, but if you were able to purchase a property discounted by a motivated seller today, that might well provide you a more attractive financial deal. (Note: The 3% number is purely hypothetical and not reflective of your market)

Do you need to sell in order to buy? Will you be trading up or down?

When looking at market statistics, be careful to look at the stats that apply to the specific segment of the market relevant to your intended transactions. For example, an overall market may be trending down in terms of units sold, but within certain price points or zip codes, the volume of sales may be increasing or values may be increasing.

A local professional will be able to provide market data relevant to the neighborhoods and price points you might be considering. This data, along with a review of your personal objectives, will provide you the insight to guide you in your decision to buy or wait.
1 vote Thank Flag Link Thu Oct 11, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
Hi George:
That's a great question many buyers are also pondering! Real estate is a local market. Each city and even neighborhoods within a city can vary greatly from what "national statistics" that are presented in the media show us. There are many questions to consider that involve timing when a person in considering buying or selling a home. Do you have a home to sell first or are you renting? Is this a home for you or an investment? Will you be paying cash or is your downpayment money frozen in the equity of your current home? What if interest rates climb before you buy? That could cost you 10s of thousands of dollars over the life of your loan compared to buying now and getting a great rate. If prices in your area don't drop or level out, what would that do to your overall plans to buy? The best thing you can do is to visit with a skilled, professional Realtor in your area who can help you work through these and other pertinent questions so that you can make the best decision possible. Short of having a real estate crystal ball, tapping the expertise of a strong, local Realtor should get you pointed in the right direction. Good Luck! (If you need the name of a good agent in your area, feel free to email or call me)
1 vote Thank Flag Link Thu Oct 11, 2007
It all depends on where you are looking for a house. You cannot depend on national trends...one needs to pick a specific area/zip code and focus in at a local level. Focus on the trends in the specific neighbourhood, etc., and see what is happening there....and also look at the price range. One example is within the same zip code, houses under $200K may be moving / being sold very quickly while there may be few buyers selling anything over $500K in the same zip code.

I would strongly caution on broad generalizations, especially in Real estate.
Web Reference: http://www.iansellsnola.com
1 vote Thank Flag Link Thu Oct 11, 2007
Since this was asked in 2007 I think the answer is painfully obvious. George SHOULD HAVE WAITED!!!

The price drops since then would pay for waiting. Even now more price drops are likely.
0 votes Thank Flag Link Sun May 23, 2010
Hi George,

You can wait and hope the market comes down some more
or
You can start looking now for that home that meets all of you need, while the prices are low, the selection is great and intrest rates are low. It is a buyers market. We seem to be close to the bottom of the market. If you are waiting to find the bottom of the market then GOOD LUCK. You will see it in your rear veiw mirror.
0 votes Thank Flag Link Sun May 23, 2010
George,

No one has the "crystal ball" as to the future. However, you need to assess what your needs are. If you are thinking of buying your own home, now is a great time. Prices are back to 2004, rates are still low, and there's incentives including the $8000 tax credit. If you bought today nad the market actually went down further before it cam back, what have you lost? The long term is a win win situation for you. If you're buying for the short term and just want to "fix & turn", that's better done in in upwards market. You're still buying low because of condition, and while you're fixing, the market is appreciating. This is NOT the time for "fix & turn".
0 votes Thank Flag Link Wed Sep 16, 2009
Hi George Davis

I believe in following your DREAM! If you would like to strart saving money and stop making others rich by paying for their mortage. Why wait? Get off the fence and start looking into building your own future. You should not let your DREAM of owning your own home be scared by what the news says. There is lots of homes on the market and who knows what kind of a deal you might find out there. Do you think that if prices of homes drop that the prices will eventually go back up? YES ! Think you can hang a picture on the wall with out the home owners telling you that you are not able to put a hole in THEIR wall!!
Good luck If you need any accentance in looking for a home I would be more than happy to help you
find "YOUR DREAM HOME"
Mylene V. Hickok 520-780-3030 Tucson
0 votes Thank Flag Link Fri Oct 12, 2007
With so many homes in the market with lots of excess owner equity, I personally think the better deal is a crazy offer with someone who's house is on the market.

If I could buy a $290K house for $240K, that's a great deal. Heck I might even settle for $10K in my pocket and $25 a month cashflow.

Look for these deals..

1. Owner buys a house for $100K 3 years ago and the value goes up to $250K. We all know 10-20 people that call that a reality. Wouldn't a seller consider taking $200K for it.

2. Builders trying to clear out excess inventory.

3. Incentives: ask for downpayment incentives, paying closing costs, ask for everything, be creative.
0 votes Thank Flag Link Thu Oct 11, 2007
Hi, George ... I'm including a link to a post I wrote several weeks ago that answers your question in detail.

But the short version of the answer is this ... if you're looking to own the property only for the short-term, then it might be worth waiting until you see definite proof the market has bottomed and is recovering. Of course, you won't know that the bottom was reached until we're off the bottom but that's another story.

If you're looking to purchase long-term, then there's little difference in purchasing a home for $200K now or $200K later (I picked a price at random.) Either way you go, you're spending the same amount of money. The big difference is in the market conditions and possible seller motivation. Once the market starts to recover there will be less inventory to choose from and sellers may be less likely to give concessions they (almost) happily will give now. Why? Because prices are improving and so are their hopes to sell.

In a flat to declining market, there's far more inventory from which to choose and sellers often are willing to offer considerable concessions to get their place sold.

Hope that helps. The article references Phoenix real estate but the market in Tucson and Green Valley isn't too dissimilar ... if anything, conditions are better in Pima County than they are in much of Maricopa.
0 votes Thank Flag Link Thu Oct 11, 2007
You can wait if you want to, but like the car sales people say, you don't want to shoot yourself in the foot for waiting too long and missing a great deal that may be out there. Real Estate goes in cycles, up and down like a roller coaster, and stocks, the key to a great investment is buying low and selling high. Many people believe that they got the best deal a few years ago. However, this market demonstrates how a Buyers Market can be a great time to buy. And a Sellers Market a bad time to buy.

In a Sellers Market they hold all the cards and all the chips. They can afford to pass up offers in hopes that a better and higher offer will come in the pipes. They can ask for more money, they can perform less repairs, and in a Sellers Market they can even refuse to pay closing costs. Some Sellers in reality were being greedy and driving up prices that if unfounded will inevitably need to come down as we see now. This is the balancing of the market to a more stable format.

In a Buyers Market you the buyer have all power, you can afford to pass up on a home and look at another. Unlike a Sellers Market where you have a low inventory of homes and you either buy or rent. The Buyers Market we see in Phoenix has a gluttony of homes that are ripe for the picking. So home sellers are more anxious to sell and are more likely to negotiate than before especially if they have been sitting on the market for a long time. Which in this market is likely since it takes on average 90 days to sell. You the buyer have all the power and and are like gold to sellers, and Agents for that matter.

So if you plan to buy I suggest you do not sit on the sidelines too long or the market will adjust again, and you may find you have been priced out of the neighborhood you liked. Real Estate Is a long term investment, and should be treated as such. The days of the making a quick buck are gone. Besides a stat I found shows how in the past 10 years Phoenix Real Estate has appreciated about 179% and the year or so of deprivation has only seen a loss of 8%. So as you can see Real Estate in Phoenix is a great long term opportunity. If you don't believe go to this site and read the stats your self.

Here is the link.
http://realiq.wordpress.com/2007/10/02/assessing-the-downtur…
0 votes Thank Flag Link Thu Oct 11, 2007
Hi George,
Yes home prices are declining, but not all areas are doing it at the same rate. Just like anything thing if you find the home you realy, really like and decide to wait for the price to reduce chances are you will lose it to another ready buyer.
I would suggest contacting a Realtor in your area to help with your quest. They can negoiate the best price for you thus making it a win, win situation for all parties involved.
please check out my web page for more information on buying a home.
Web Reference: http://PaulineRoth.com
0 votes Thank Flag Link Thu Oct 11, 2007
Like selling, it depends on whether or not you have to, and the local market. Personally, renting wouldn't be an option for me. YMMV.
0 votes Thank Flag Link Thu Oct 11, 2007
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