Is Now the Right Time to Take Advantage of the Buyer's Market?
Many people who have not previously purchased a home are now giving
thought to the idea as prices continue to drop and the number of homes
on the market escalates. Still, many are not sure whether they should
buy a home now or wait out awhile to see where the market will finally
settle. Obviously it's a home buyers market now. So, is now the
right time to buy a house?
Generally, the best time to make any type of major purchase, such as a
home, is when the market is conducive to doing so. That would certainly
seem to be the case now, while home buyers are able to be quite
selective in their choices and save money when they finally do make a
decision.
As professional real estate investors know, the best strategy for
investing in real estate is to buy when you can do so at a low price and
then sell when the market has experienced an upswing. As every
professional real estate investor knows, "You make money when you
BUY, not when you SELL". The lower you buy; the more money you will
make when you eventually sell the property.
In most markets today, buyers can purchase a home for at least 5% below
the asking prices. Some buyers find they can purchase homes at as much
as 10% below the asking price. On a modest $150,000 home that means
buyers can save as much as $15,000.
In addition to the upfront savings, many home sellers are also able to
offer additional incentives in order to move their homes. These
incentives include assistance with closing costs; which can be quite
attractive to first time home buyers who may not have a large amount of
cash to put toward the purchase of a home.
Still, while the national market certainly may point to the fact that
now is an excellent time for buyers to take the plunge and go ahead and
purchase a home, it is generally a good idea to make sure you are
researching locally as well. Local markets due have a tendency to be
somewhat different from the national market. For example, some areas
have become quite hot. Within the Washington DC area there are several
pocket markets that are actually seller’s markets. Within these small
pockets homes are selling in less than two months, prices are up and the
number of closings is up from just a year ago.
Such markets are few and far between; however, and the home buyer that
has been sitting on the fence trying to decide whether now is the right
time for them to buy or not would do well to review their local market
and seriously consider taking the initiative. One of the keys to
remember, if you have been hesitating about purchasing a home, is that
while it is true there has been a spiral in sales prices on both coasts;
the correction was long overdue in coming. On both the East and the West
coasts prices had escalated so quickly that a correction was inevitable.
That said; buyers who live basically in Middle America; however, will
find that price declines have not been nearly as dramatic as in other
areas. In these areas, buyers will not actually see an immediate benefit
in waiting to purchase a home. In fact, those buyers who continue to put
off purchasing a home may even lose significant advantages; such as a
wide selection and sales prices that are quite affordable.
The widespread rumor that mortgage money is no longer available has been
largely overstated. The simple fact of the matter is that there is still
mortgage money available. Buyers who have significant credit problems
may find it is not as easy to purchase a home as in past years; however,
those buyers with reasonable credit will find they are still able to be
approved for mortgage loans. Certainly, qualifications are now being
more rigorously examined and more documentation is required, but
mortgage money is still available. In addition, mortgage rates are still
relatively low.
If you have ever thought of buying a home, now could very well be
the best time to do so. Even if you live on the West Coast or the East
coast, it could still be an excellent time to buy. Residents in the
Seattle area, for example, are welcoming the price declines. In the
past, prices rose so quickly that it was difficult for many to even
consider purchasing a home. As a result of declining sales, many home
sellers are beginning to set more realistic sales prices for their
homes.
The bottom line is that buyers have never had a wider selection than
they do now besides the ability to buy a home at prices that are
considered by many to be quite affordable.
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