Buy now – don’t wait.
A lot of buyers are saying they want to buy but they are waiting until prices hit rock bottom. First, it is really hard to tell when the market has hit bottom. It does not matter if we are talking about gold, stocks or homes here. Trying to time the bottom is almost impossible.
Is it likely that prices will go down further? Yes, it is is. In fact, I do not believe that we have seen the bottom yet. However, I do not forsee any more drastic drops.
You should buy now because prices are low and financing rates are low. It is important to keep in mind that purchase price alone does not determine the cost of investment but the combination of purchase price and mortgage interest rate determine the true cost. For a more detailed explanation and some compelling examples take a look at my blog entry from Oct. 22, 2008.
If you are a cash buyer, feel free to wait what you perceive to be the bottom of the market. However, if you are like most buyers who need to get a loan to finance a home purchase, don’t wait to buy. Interest rates are great at the moment but everyone in the lending industry I have talked to says they will soon go up. Higher rates will affect your buying power or may even make it impossible for you to qualify alltogether. Just talk to some of your relatives or friends who bought in the eighties – the rate was 17.48% in January of 1982 (source Freddie Mac homepage). Now rates are going to jump that high overnight or perhaps ever again but I just wanted to make the point that you need to look at the cost of financing, as well as the purchase price.
Just for fun, take a look at the mortgage rate changes between 1971 – 2008.
So, don’t delay. Buy today. We would be happy to help you take advantage of this great buyer’s market. The opportunities are amazing.
Kerstin G. Brooks, ABR, Realtor
Brooks & Heinze Team at Skyline Properties, Inc.
Cell: 206.276.5827
Email: kerstinbrooks@earthlink.net
Web: www. propertyinseattle.com
Kerstin G. Brooks, Broker 