It is still a good time to buy a home for many people.
First, the government is looking to help you. If you are a first time buyer (which, to the government, is defined as anyone who has not owned a home in the last three years), you are entitled to a maximum $8,000 tax credit. Additionally, interest rates are at all-time lows and the Federal government is taking steps to insure and make these loans available to more and more people.
Also, there is the concept of Leverage. Leverage is defined basically as borrowing money to supplement existing funds for investment. Imagine if you invested ten thousand dollars in stocks and those stocks earned ten percent, you would have earned one thousand dollars. But investing ten thousand dollars on a home, and having that home's value increase ten percent; effectively, you would have earned ten thousand dollars. Which sounds like a better investment to you?
Here is something else to consider. Regardless of the market, you have to live somewhere. And so does everyone else. According to nationwide statistics, approximately 800,000 new households are created each year in the United States alone. Each of these households will need housing, regardless of the state of the economy. Also, the economy is a cycle, and like a cycle, what goes down must come back up. With the right fixed-rate mortgage, you are basically ensuring the same payment for thirty years. If you try to rent an apartment for thirty years, odds are that every year or so, your rent will be increased. That does not happen with mortgages.
With that said, if you hold onto the home for 10 years will you really look back then and wonder if you had only waited 2 more months to buy, maybe you could have purchased the home for less? I doubt it. Instead you'll look at the 10 years of tax write offs you've had and the appreciation you've earned. Most importantly with any home purchase, you need to find the right home, in the right location, at the price that works for you with a comfortable payment. Then you will be happy with your purchase, your investment and the place you call home.
-Dee Dee Lombardi
I firmly feel that this is one of the best times to buy. Home prices are down! Interest rates are down! The question is, are you going to wait until the media begins to report, "Now is the time to buy." Please be aware, that they will print that quite some time AFTER the bottom has hit and things shift upwards. They will wait to see a consistant upward trend before they give "Their blessing to buy." Of course, by this time the market will have more buyers, meaning multiple offers, meaning that sellers will begin to raise the asking prices - and not to mention...no one knows where interest rates will be!
But ultimately it depends on what your needs are at this time. How long you plan on living within that home? What you can afford and why you are buying.
I would suggest sitting down with a Realtor to get a no obligation, no sales pitch consultation.
Best of luck,
Robert M. van der Goes