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Buyerinaustin, Home Buyer in Austin, TX

Should I be worried about the fiscal cliff ?

Asked by Buyerinaustin, Austin, TX Tue Dec 4, 2012

I wanted to close on a house, but with the looming fiscal cliff , it looks like I should wait, what are the your opinions ?

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I think everyone should always be concerned with how our economy is administrated and what that means for a number of real estate-related issues. This was an excellent post that clearly outlines some of the benefits we might have seen under reduced taxation, the least of which is an economy that might have started to significantly grow again. The economic assault currently underway with fiscal policy isn't making things better and there's little doubt that better policies that actually encourage growth would also encourage appreciation and real estate values as a whole. Increasing tax rates, like increasing the cost of anything else, produces much less of what we really need - more jobs, more income, less spending, and a healthier economy capable of increasing the value of your investments. Concern is definitely warranted, as is a good dose of caution when it comes to financial decision-making.
0 votes Thank Flag Link Tue Jan 8, 2013
Just found this on Mark Dotzour's blog. Specifically about the fiscal Cliff. Again, head Economist for Texas A&M Research Center specifically for Real Estate and the Economy of Texas. Just copy and past the URL.

http://blog.recenter.tamu.edu/2012/11/over-the-edge/
0 votes Thank Flag Link Tue Dec 4, 2012
I think it comes down to being informed. No one knows what is going to happen with this fiscal cliff. I say trust your instincts. If you have 20% to put down, no other debt and six months worth of living expenses in the savings account you should be fine. Dave Ramsey is whom I just quoted, and he is more qualified to speak of Economics than all of us combined in my opinion. Make sure you purchase within your means and research all you can about the local economy. This is a great place to start right here, Mark Dotzour with Texas A&M Real Estate Center, http://markdotzour.com/.

Do not make decisions based on fear, just good info. Once you have the info, you can then make decisions based on solid information.

P.S. Dave Ramsey says your mortgage should never be more than 25% of your monthly income. I agree. I say buy low, look for great values, and never buy high!
0 votes Thank Flag Link Tue Dec 4, 2012
I've never had a crystal ball, and still don't. We make the best decisions we can with the information we have at the time. If I can afford to buy and not spend myself to the limit in doing so, then I say it's a reasonable decision. If it makes me lose sleep at night, it isn't worth the investment. Perhaps you need a good financial advisor if you aren't sure what to do.
0 votes Thank Flag Link Tue Dec 4, 2012
I guess it depends on your financial situation.

If we go over the cliff.... Most middle class families can expect to pay up to $2000 more in taxes?
I think that was what I read.

If less than $200/month makes or breaks your deal.... I would be worried.
0 votes Thank Flag Link Tue Dec 4, 2012
If you are a buyer in Austin, Texas, and feel good about the home you are buying I would move forward. Real estate largely a local business, and local supply and demand are among the most significant market drivers. Austin is the 3rd ranked market for job growth nationally, and continues to outperform other markets. 2012 Austin metro area sales are strongest in some time, and supply levels are falling. I think people that buy real estate in our area during this time period will only look back and wish they owned more, or didn't sell their present home in order to buy a new one.
If you are currently under contract to buy, and are seriously considering terminating your purchase agreement, you should consult with your realtor and/or real estate attorney to fully understand the consequesnces of default, unless you have purchased an option to terminate that has not expired or have some other valid means to terminate withot default.
0 votes Thank Flag Link Tue Dec 4, 2012
What is your concern? If you're buying a property to live in as a homestead and your job seems stable, then buy. Purchase money is cheap and with the increasing inflation, buy on a 30 year note and pay the bank back with significantly deflated dollars....you win!
0 votes Thank Flag Link Tue Dec 4, 2012
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