With record job losses and foreclosures, 2008 did not end well for the real estate industry. There are signs, however, it will turn around in 2009.  Among those reasons are historically low interest rates and a rise in inventory.  There are glimmers of hope starting to emerge for both buyers and sellers.

Nearly everywhere you go you see for sale signs and those signs each represent someone wanting or needing to get out of their mortgage and a potential good deal for buyers.

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Home prices declined at a record pace around the nation in the final three months of 2008, according to an industry report released Tuesday.

The S&P Case-Shiller National Home Price Index reported that prices sank a record 18.2% during the last three months of 2008, compared with the same period in 2007.

Case-Shiller’s index of 20 major metropolitan areas fell 18.5%, also a record.

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It is only natural for some consumers to be wary of buying a house in the current market conditions. Some of the most typical concerns for most consumers are whether they will overpay for a house and whether the price of their home will actually drop over the next several years.

If you’re comfortable with the idea of taking a bit of risk; however, now might actually be the best time to purchase a home. One of the best benefits of purchasing a home right now is the fact that prices are lower in many markets than they were just a few years ago. As a result, if you found that a home in a particular market was unaffordable just a couple of years ago you may now be able to afford that very home.

In addition, concessions are now in. Many home buyers have found that they can ask sellers for practically anything and stand a good chance of actually getting it. Some possibilities include paid closing costs, improvements to the home, price reductions and much more. Sellers are often willing to make such concessions today because they are desperate to sell their homes.

It should also be considered that competition may not be all that stiff when you start shopping around for a home. One might think that buyers would be turning out in droves to take advantage of lower prices, but it seems that many buyers are still cautious and are playing a game of wait and see when it comes to the real estate market.

Furthermore, the matter of choice is astounding. The inventory of homes on the market ensures that you will probably be able to find whatever you are looking for. If you’re looking for a specific number of bedrooms, a pool or a home in a certain location, you will probably be able to find it.

Beyond the fact that you may be able to find what you are looking for in terms of existing homes, but you make also be able to find a good deal from a builder as well. Home sellers are not the only ones who have been hard hit by the real estate market. Builders have become far more aggressive in their efforts to move new homes. A builder that is looking to clear out an inventory may be very willing to negotiate.

Another great benefit to buying in the current market is the fact that interest rates are lower than they have been in a long, long time. Over the life of your loan this means that you can literally save thousands of dollars. It also means that you might be able to purchase more home because your monthly mortgage payment would be more affordable, even on a more expensive home.

When shopping in the current market, it is important to understand that local markets can vary somewhat. According to the national reports, it would seem that markets all over the country have dropped, but there are some pockets where the market has actually experienced rebounds. This means that prices may not be quite as low as you might expect, so it is important to make sure you know the ins and outs of your local market when you are making a decision to buy in the current market.

You also need to make sure that you have obtained pre-approval for a mortgage loan before you actually begin shopping around. This will actually give you the best opportunity for making the best deal possible when you start shopping around. Not only will sellers take your offer more seriously, but if you are shopping for a new home from a builder, you may also be able to negotiate better concessions as well.

Given the low prices, low interest rates, large inventory and willingness of sellers and builders to make concessions, now very well could be the best time we have seen in a long time to make a home purchase. By making sure that you are prepared before you begin shopping for your next home will go a long way toward helping you find the best home possible.

“Most striking are numbers that indicate the typical buyer of the future will be childless,” Mr. Otteau said in a recent interview. “Either single, part of a childless couple, or with grown children.”

Although half of all American households included children in the 1980s, he noted, only a third did by 2000.

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HOME is not only where the heart is. Increasingly, it is also where the tax breaks are, and not just the all-important deductions for mortgage interest and real estate taxes. Recent provisions offer breaks for home sales and purchases, for example.

Of course, these provisions are but a few aspects of the nation’s complex and ever-changing tax code. There are many other possibilities for saving on taxes — or for being tripped up.

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Nearly 1,600 people showed up in downtown San Jose on Saturday morning, hoping for a chance to buy one of over 190 foreclosed homes being sold off at bargain-basement prices.

The properties had been turned over to the auctioneer, Real Estate Disposition Corp., by lenders and were scattered throughout the East and South Bay. Frequently, homes sold at auctions like the one in San Jose have been abandoned or are in very poor condition, among other things.

“Banks are motivated, interest rates are at all-time lows, and you can buy low and sell high,” Walter Skrzynski, an executive vice president of the firm that ran the auction, told the crowd. “There’s not a better way to buy.”

* Full story: Available on SFGate

The Senate’s proposed $15,000 tax credit for homebuyers would boost the ailing housing market but do little to help low-income people who need it most, experts say.

The measure, which is part of the $827-billion economic stimulus plan that the Senate will vote on Tuesday, would offer the credit to anyone who buys a primary residence. But to take full advantage of the credit, buyers would have to earn enough to use it and spend at least $150,000 on a home.

As many as 1 million home sales could result from the tax credit, according to Mary Trupo of the National Assn. of Realtors.

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The Housing and Economic Recovery Act of 2008 (HERA) gives some house buyers an interest-free loan for buying a house. A married couple can reduce their federal income taxes in 2008 and 2009 by a maximum of $7500, for a total of $15,000 as tax credits. A single taxpayer gets half the credit. One is eligible if one did not own one’s residence during the previous three years. To qualify, one has to have bought the house after April 8, 2008, and before July 1, 2009. The credit is ten percent of the purchase price or the stated maximums, whichever is less. The credit is not available to those with upper incomes, such as above $95,000 for a single person.

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U.S. home prices will reach bottom by the end of the year, concluding a slide that will have cut values 36 percent, Moody’s Economy.com said today.

“Notwithstanding the intensifying economic gloom, the bottom of the housing downturn is within sight,” chief economist Mark Zandi said in a statement today. “Presuming we see strong action by policymakers to help support the economy and the housing market, prices will begin to recover by the end of this year.”

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Real estate values around the nation have collapsed, and sales of foreclosed and “underwater” homes now dominate many housing markets, according to a report released Tuesday.

The report, from Zillow.com, a real estate Web site, revealed that with foreclosures soaring, nearly 20% of the nation’s home sales in 2008 were of bank-repossessed properties. Another 11% were short sales, in which homeowners owed more in mortgage debt than their homes were worth.

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