I am a new home buyer- should I wait until next spring to buy?

Asked by Tara, Jacksonville, FL Sun Nov 25, 2007

Will prices be lower?

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Cindy Gavin…, Agent, Jacksonville, FL
Mon Nov 26, 2007
Hi Tara,
You say "new home" buyer, so I'm not sure if you are speaking as a "first time" buyer or a "new home" buyer. If you are looking at new construction in the Jacksonville area, I think now is a great time to be buying new construction. Builders are saturated with inventory, and they want to unload it. Unlike the past, most builders will now negoiate their bottom line price, plus they are throwing in so many incentives on top of huge price reductions. If you are looking at resales, I really don't think we are going to see a huge difference between now and Spring 2008 as far as prices. Resales are also in a very competitive market in Jacksonville. Many sellers are offering incentives and many have already adjusted their pricing to reflect this current market. It's hard to say if Jacksonville will see a greater decline than we already have, but the rates are still historically low and there are great deals out there! I wish you the best in your home search!
1 vote
Ruthmarie Hi…, , Westchester County, NY
Sun Nov 25, 2007
The state you are in is in the midst of a major correction, but you don't need me to tell you that.
A couple of comments and then some questions for you to answer for yourself.

1. No one rings a bell when the market bottoms. So DON'T try to time this. No matter how hard you try there is a 99% probability you will miss the upturn.
2. As a general rule, the time to buy is when everyone else is running away.
3. Traditionally, WINTER is the best time to buy. But that may be a northeast rule - you are in Florida - so I don't know how true this is.
4. If you need to buy in the relatively near future watch INTEREST RATES and listen to the news and read the papers. If interest rates seem poised to rise - GET MOVING. An increase in interest rates has a far bigger impact on affordability than the actual sticker price.
5. Keep tabs on you ABILITY TO BUY. Credit is very, very tight. If the tightening is going to squeeze you out - get moving (unless you are content to rent for several years.)
6. Remember that Florida has had a strong correction. Since you can't tell where the bottom really is - don't get too greedy. You will be in your home for several years. Appreciation will return. I don't know your specific area - but in most areas of Florida, it is unlikely that you would be catching a falling knife.

Questions you need to answer:

what are rents like in your area? Where I am -once tax deductions are factored in - it is often cheaper to buy than to rent. And remember that with each month the loan amortizes - so a certain amount of equity is being tucked away at the same time. I had one couple in my office that were literally throwing away $8000 a year more renting when you factored in amortization, tax deductions and price. This is more than average , but in my market I usually find that renters are about $5000 behind every year. THIS IS VERY MARKET SPECIFIC - so you need to know the numbers.

What is your time frame for staying in your home? The longer you are going to stay put, the less important finding the market bottom is and waiting may be penny wise and pound foolish.

Hope this helps.
1 vote
Lizbeth Uribe…, Agent, Laredo, TX
Sun Nov 25, 2007
The best time to buy is when you're ready. When your finances are in order and your debt is at its minimum. In a perfect world, your monthly mortgage payment shouldn't be more than 30-35% of your net monthly income.
If you've been monitoring your market, you'll see whether homes have been appreciating or depreciating in price within the last few months. Check with a Sales Agent so that you can familiarize yourself with the market and get their opinion on latest market trends. You should also start looking at homes, so that you can familiarize yourself with different home features and pricing, as well as neighborhoods you may be considering.
1 vote
Linette Carr…, Agent, Wilmington, DE
Mon Sep 14, 2009
An addendum to what I have already written. I assume that this is your first home. If that is the case. Interest rates are very good, prices are excellent and if you buy and close before November 30th you will receive up to $8000 from the government. It's a no brainer.
0 votes
Huserich, Home Seller, Jacksonville, FL
Mon Sep 14, 2009
Let me speak from a person who is has a house on the market (not an agent or a broker) I live in Florida and have been attempting to sell for over a year. We live in an upbeat area of town that in normal times would be highly sought after. These days are not normal and sales in our area are way down, and prices continue to drop. My advice is not to sit on the sidelines, but to get in find several that you like and make very aggressive offers. 10% off, 12% off or more, especially if you know the house has been on th market for a while. My home was listed this time last year at over $500,000, today I would be happy if I could get someone to bid $380,000. People are eager to sell for a variety of reasons, you can get a great deal, but I believe by spring you will have missed the best of it, because rates typically climb in the sping and sellers like myself will have slashed enough to attract a bid just to move on with life.
0 votes
Jim Darling, , Green Cove Springs, FL
Sun Feb 17, 2008
I agree with the others on now being a good time to buy. I try to put myself into the shoes of the buyer and if I was to look at when to buy, it would be when I find that house that feels like my home. If you wait and pass up these homes just to save a few $$, you may find yourself in a home that you really will not be happy with but you may save money. Which would you want? So if you find the house that feels like a home to you and your family, GRAB IT. Your will be happier in the long run and maybe you will get a great deal, if not you still win.
0 votes
Francesca Pa…, , Monmouth Cty NJ
Sun Nov 25, 2007
At a minimum, start using the Realtor.com to peruse the available properties in your areas of interest. By the time buyers reach me, that are often quite knowledge of the inventory and price reductions!
0 votes
Linette Carr…, Agent, Wilmington, DE
Sun Nov 25, 2007
?????????? I read articles that say prices will stabilize and some that say the market has a long way to drop. I can only guess just like everyone else. If you are in the market for a home and the price of the home you want seems reasonable in your market buy the home. If you are not willing to pay todays prices continue to pay rent .
Here's a thought. Figure out what you would pay if you paid rent for the next five years. Now figure out how much equity you would accumulate if you bought a home today and kept it for the next five years assuming the market stays exactly the same as it is today ( no increaase or decrease in price). Don't count closing costs because you will pay them whenever you do buy a home. Let us know what you figure out.
0 votes
The Hagley G…, Agent, Pleasanton, CA
Sun Nov 25, 2007
It's hard to predict. Lot's of questions....for instance.....if home prices are lower will interest rates be higher? If so, is this a wash? Rates are low and prices are low, making it a great time to buy. Start looking...when you find what you like, find a Realtor and make an offer. It's a great time to buy!
Web Reference:  http://www.cindihagley.com
0 votes
Trulia Roger, Home Buyer, Alameda, CA
Sun Nov 25, 2007
It's an expensive bet. I don't know about your specific area, but we decided back in 2005 to wait until the market correction really hits. So far it hasn't really happened significantly enough, and a lot of leading market observers and economists predict the current market difficulties will not stabilize for months, if not years. So I'm content renting right now, for as long as it takes. :)
0 votes
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