Market Conditions in Newport>Question Details

Fi, Home Buyer in Newport, RI

is it better to buy now or will prices decresae or increase in spring / summer?

Asked by Fi, Newport, RI Mon Dec 31, 2007

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8
everything going down across the country. wait, be patient. what do you think recession does to housing prices? now factor in that there are way too many houses. yep, going way down.

good luck

2010, maybe time to buy
0 votes Thank Flag Link Mon Mar 17, 2008
The Pending Index, or number of contracts on homes, dropped significantly in November/December 07. This has resulted in fewer sales in 08 compared to same period last year. However, the number of contracts so far this year is strong. So, sales numbers should increase this spring an ddepending on the levels of inventory, we may see slight devaluation - 3% to 5% or so. But watch the interest rates, this is more critical to the buying process as 1% increase in mortgage rates will erode 20% of buying power.
0 votes Thank Flag Link Sat Mar 15, 2008
OK, 2008 has started and you will see extremely few sales in the Newport area in the last 60 days. This is obviously only my opinion, but the market seems to be one of sellers "holding out" and hoping against hope - based on (sometimes) the nice words of their local realtor. However, looking at the data it is safe to say those those who purchased at the top of the market in 2006 have lost equity. Houses are being lowered in price - sometimes drastically - from then. But a big problem is that the seller often has a basis (cost) of higher than what the house is worth. I suspect the next shoe is about to drop as certain sellers either heavily discount or else give their houses up.

Certainly there may be exceptions to the rule, but I predict 2004 prices for most area real estate, with the further danger of depreciation from there. Real Estate is not much different from stocks....speculation drives the market on the way up and on the way down. The last big market downturn (S&L crisis 1990) took 8 years in many places to work itself out - by any measure the current situation is much worse.

Not guessing, but rosy scenarios have less of a chance than do realistic ones. To clearly answer the question - this is a good time to buy IF you are not attached to a certain house and can stomach making offers of 10 to 20% below the listing prices. My opinion...of course.
0 votes Thank Flag Link Thu Feb 14, 2008
Some projections are that prices will decline but you have to look at the individual property type and location. Our employment picture is pretty strong so we shouldn't see too much of a drop. Perhaps 5%. Sellers are much more receptive to lower offers in this market.
0 votes Thank Flag Link Thu Feb 14, 2008
There are some great buys on the market right now. The last two homes my buyers put offers in on got six other offers. Many of the offers where over asking.
Web Reference: http://housemenus.com/
0 votes Thank Flag Link Tue Feb 12, 2008
What does it really matter? If you are looking to be in the property for more than 5 years then it really doesnt have a big effect. Prices won't drop that much and the real expense could be an increase in mortgage rates. 1% increase in mortgage rates reduces 20% of buying power. If you are planning on living in the property for less than 2 years, rent.
Web Reference: http://www.raveis.com
0 votes Thank Flag Link Fri Jan 11, 2008
That depends on the neighborhood you are looking to purchase a home in. A local realtor could get you statistical information on how many homes are on the market and how long it took to sell those homes and what months were the hottest for that area. This can be broken down for you by street, zip, or area.
0 votes Thank Flag Link Tue Jan 1, 2008
Fi,

It is hard to predict exactly what the market will be for the year 2008. Typically, spring time peaks with demand and therefore price and inventory. However, many are not sure what will happen in 2008. The housing market is projected to continue down. Has it hit bottom yet? Who knows. Some say yes, some say it has another 30% drop to go. As in placing money in the stock market it takes a lot of pure luck to pick the exact right moment to purchase for the best value.

Buying a home is more than a stock. It is as much an emotional decision as it is an investment in your personal future. So it is important to ask yourself if you are personally ready to buy a home? Do you want a place of your own where you can paint the walls any color you want? Are you starting a family and want to set up for a safe neighborhood for your kids to play and go to school? The financial future asks other questions. Do you have the down payment? Do you have a good credit score? Have you spoken with a lender or financial adviser to see how a house payment could work in your over all financial situation? Do you need the tax break?

If you are ready to buy a house, then my advice would be to buy as soon as you find something you love. Trying to predict the exact best time to buy will make the process so much more stressful and there is no way to guarantee you will hit the mark of "best deal".

Being an educated buyer is the first step and I assume that is why you posted the question. Find out as much as you can about the neighborhoods that you are interested in. Have a Realtor look at trends for that area. Particularly, have them look at short sale and foreclosure stats. There is a great site called ForeclosureRadar.com that you can type in an address and see up to 20 homes (if there are any) that are in some state of foreclosure.

Also look at DOM (Days On Market) and TFT (transaction fell through) to identify probable motivated sellers.
Just as you would research a stock, research the housing market you are interested in. It is also important to evaluate the decision by deciding whether or not it is a short term investment or a long term investment. Choosing neighborhoods that are transitional now, but have all the right things to make them great 5-10 years from now can offer up some bargains. A Realtor can help you identify those areas.

Good luck and Happy New Year!

CJ
0 votes Thank Flag Link Tue Jan 1, 2008
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