So with all the news out there about the mortgage market right now, what are everyone's thoughts about buying a house right now? If one was in a position to wait, would you recommend it? Or would you recommend entering a low ball bid? just curious...
It depends on what market you're in. If you have a house in mind check all the comps in the neighborhood. Then check to see how long the house has been on the market. If it's been more than a month I think a low ball offer is good. If you're gonna low ball make it an offer that is almost embarrassing. Most of the comps online are 3-6mos+ old but you can talk to a realtor to get up to date #'s.
If you are planning to hold only short term and try to take a profit, you are too early and should wait. If you are looking for a residence and plan to stay a few years, this is a great time to be making offers to anxious sellers. Realtors are dying for qualified buyers. So find a good one and tell him/her that you are going to be making lowball offers. Find one who will represent you, and not the seller.
It is really going to depend on your situation. Like the previous posts mention, if you are in it for any period of time (5 years min) there is nothing wrong with looking now. My wife and I just bought a new home after the seller accepted our low-ball, take-it-or-leave-it offer. In our situation, we needed more room and have been looking to move for a couple years. We also used a buyer's agent who helped us stand our ground when making the purchase (it was nice to have another party on our side of the transaction). Best of luck.
If you can wait till 2009 or 2010 I think you'll save 20%. Mortgage resets don't peak till Feb/Mar of 2008, so those people's homes won't be on the auction block till fall of 2008 or after. If my guess is correct, winter of 2008/2009 will be desperate times.
Sounds accurate to me. I have been putting off making my first purchase for some time. Too bad I'm down 40k this year which would have been a nice down payment. I hthink renting is best right now. There will be plenty of foreclosures popping up. Buy from someone desperate to dump their house. If anyone has a good foreclosure link, please let me know.
That is what typical buyers are doing. Holding off, holding off and holding off. Now if these idiots go out and try to get financed unless they are A+ paper borrowers they won't get a loan! The landscape has completely changed . They are screwed! The lender will bang their butt with a frying pan and say thank you for stopping by! Renting is money down the drain. No one ever made out rich by renting and chained to a landlord. There is a massive tax deduction that is still missing for renters which home owners enjoy. Plus there is a $250,000 or $500,000 free tax ride when you sell your home if you owned it for 2 years! These idiots have postponed all those bright prospects hoping they can low ball something and snag off a deal. What they don't realize that ain't going to happen, you are too green and to naive to punish home owners who have been through the mill. Yeah go on, keep renting...its surefire way to a lesser quality of life. You would be washing your clothes at the local laundromat among other losers.
I agree man with renting and throwing money down the toilet every month. I have always believed that through any economic time. Same feeling on leasing cars... Real estate has always been the best investment over time and owning no doubt. I'm just saying its peaked in the last year (depending on what area of course). You wait a little, shop around for a deal, do some research, talk to some people in the business, etc. and a little patience and DD will be rewarded. There will be suckers who rent their whole life. Those suckers who in the past who got to be homeowners through a nifty stated no doc., sub prime, etc. took it hook line and sinker. Now, smart buyers and good credit will put 20% or more down on that, get a great rate, and they will be your bitch and pay your mortgage by renting that downstairs to them.
There was a thread here a few months ago with documented proof that real estate has barely outperformed inflation (I believe the return is less than 1% above the rate of inflation over the past 80 years). Check out this article.. http://www.forbes.com/home/realestate/2005/05/27/cx_sc_0527home.html "But if you take a longer view--say 25 years--you'll find that the S&P 500 has actually stomped the real estate market, from Boston to Detroit to Dallas. From the start of 1980 to the end of 2004, home sale prices increased 247%. A pretty sweet deal, it would seem. Over the same period, however, the S&P 500 shot up more than 1,000%."
Renting is the best thing to do. It gives you a chance to waste money each and every month. It's a wonderful feeling to know that you're enriching the landlord by paying his mortgage and letting him participate in the gains. Seriously, I don't know why anyone would rent long term. If they can't afford to buy a home in their area, they should move somewhere more affordable, like the Atlanta, Dallas, or Houston areas. No reason to deal with the overpriced NYC, LA, or San Francisco real estate markets.