Since so much time has passed since the last post, let’s get down to business and discuss the market. What market you say? Exactly! People come strutting into my office asking me to time the market for them. Here is the deal; I can time the market just about as good as the next guy. No one really knows what is going to happen but I will give you my take on the whole situation and you can do with it what you will.
In the early 2008 year, I think the economy will continue in the direction of a recession. With this said, the housing market will continue to decline. In an effort to jump-start the economy out of this recession, I believe the Fed’s will drop interest rates.
On that note, this will be a great opportunity to refinance. Many experts agree that if you can lock into a fixed rate at about 2% lower than your current rate, go for it. Keep in mind that a refinance can bring unexpected closing cost that you need to be prepared for. But in my opinion you will save money in the end. I’m a big advocate of fixed rate mortgages.
Now I want to bring up the dreaded question of: Should I buy a house now or should I wait? Here is what I think; buy it now! If you plan on buying a new home, plan on being in that home for a few years, and can qualify for that new home without over extending yourself, then I think you should do it. Many brokers don’t agree saying that you could lose a lot of money. For instance, if you put 30% down on your home and the housing market falls 15%, you have lost half your investment. Yes, this is true, but if you plan on staying in your home for a few years, you can wait out this down turn. If you are scarred of this happening, offer 10% - 15% below asking price to compensate for any lose you feel you may consume. It is important to remember that the market is constantly fluctuating and today your house may be worth a little less than it did yesterday or vice-versa.
These days’ homes on average tend to be on the market for a longer period of time. This is a huge advantage to the buyer in that the seller will often consider your offer and most likely counter do to the fact that their home has been sitting on the market for some time now and they are ready to move it. This creates a situation in which the buyer and seller end up with a deal that makes them both happy.
Like I mentioned earlier if you are buying a house in the market today, you are probably going to get an remarkable deal on the house and in the future, the home will increase in value as the market goes back up.
I can’t tell you what the market is going to do or if you should buy a new home today or tomorrow. A good deal to one person is not necessarily a good deal to the next. Everyone has their own opinion of GOOD and if you feel you have a GOOD deal, run with it. In the end you are the one who has to be happy and I can’t tell you what you want to hear to make yourself happy.
