to buy or not to buy (A house in this market)

[lin67]

more from NAR: Prices Rise, Existing-Home Sales Decline in June (http://www.realtor.org/press_room/news_releases/2007/ehs_june07_prices_rise.html - broken link)

"Existing-home sales in the Northeast fell 7.3 percent to a level of 1.01 million in June, and are 7.3 percent lower than June 2006. The median existing-home price in the Northeast was $294,400, up 1.8 percent from a year ago."

[ching1698]

In Greater Edison/Piscataway/Metuchen/Woodbridge/South Plainfield/North Brunswick ... area, you want to buy than wait, especially, buying condo or townhouses. There are growing number of IT professionals working at Wall St moving to the area, and many rental apartments rented out and rent hike, so you may find out owning a condo or townhouse cost less.

Also, if you call your realtor, you may find out many condo or townhouse communities in this area sold very fast, e.g. University Heights at Piscataway just sold out, same as Edison Manor, Edison Hollow South, Starpoint at Piscataway got only one left. Westgate of Edison sold dozen last month, same as Maple Grove at Piscataway. Governor Pointed at North Brunswick sold over 50 units this year, most Metuchen condo/townhouses sold....etc.

In general, I do not see wise to specular, but I also know people buying multiple condo townhouses for investment in the area.

Also, due to gas price hike, towns in NJ with easy access to NJ Transit would be very popular, so location location location is very important...

Another thing I saw is that due to immigration law may change, many immigrants have been buying in NJ, especially, Hispanic people...

Also, babyboomers, people born 1946 to 1964, start retiring and downsizing, so in the years to come, they may sold their big houses and move to condo or townhouses. Also, their kids start buying their first home, so condo and townhouse could be the target.

[juliann1977]

Does it mean the price is starting to move up? or just propaganda?

Honestly, I think it just means pricing hasn't been affected as much by the slump yet as some might think. Different markets drive up those median prices too. I know everything in my area is listing for 10-15% less than it did a year ago.

[Onizuka]

Originally Posted by juliann1977

Say someone thinks his house is worth 600k and drops to 400k. Maybe the house will sell, maybe it won't. There is no economic sense in dropping 1/3 if your house wasn't overpriced to begin with.

See, this is all what it comes down to, as I said earlier. Stubborn sellers think their house is worth more than it actually is. The value of your house is determined by what buyers are willing to pay, not what you think it is worth. There needs to be a buyer and a seller willing to trade at a certain transaction price for there to be a transaction. And if supply is higher and demand is lower, that means sellers are the ones that will have to give if they really need to sell their house.

If buyers are not even looking at your house, it means your house is overpriced; it means buyers do not want your house at your price (because your house is priced too high even with a reasonable discount that might come after negotiation). If they are looking and bidding, maybe it's not so bad and you can afford to wait some more.

But anyway, with regards to "speculation", these are FACTS. Read the news.

1) Foreclosures are up, and people are defaulting. That is why all the CDOs are dropping in value and is what made those two Bear Stearns hedge funds go belly up 2 weeks ago.

2) Liquidity is drying up. Because of this subprime mess, lending standards are going up again. No more $600k loans for $80k salaries (or $300k for $40k, if you prefer). People are going to have to be able to actually afford their homes again, instead of relying on toxic mortgages.