Realtors: Which Is It? (incentive, foreclosures, agents, mortgage)

[chesapeakesim]

To all realtors,

I have seen your ads that state that now is the perfect time to buy a home and that people had better buy before prices go up.

Then at the same time I read articles saying that the NAR is pushing to extend the housing tax credit cause without it the market will tank and house prices will plummet.

So which is it? If the housing market is strong enough for you to recommend buying, it should not matter if the government provides a stimulus. But if the market is so down that without a government hand out prices will fall through the roof, then you should not be recommending anyone to buy at this point.

Can someone please explain how you can support both positions at once?

[Flat2MT]

Originally Posted by chesapeakesim

To all realtors,

I have seen your ads that state that now is the perfect time to buy a home and that people had better buy before prices go up.

Then at the same time I read articles saying that the NAR is pushing to extend the housing tax credit cause without it the market will tank and house prices will plummet.

So which is it? If the housing market is strong enough for you to recommend buying, it should not matter if the government provides a stimulus. But if the market is so down that without a government hand out prices will fall through the roof, then you should not be recommending anyone to buy at this point.

Can someone please explain how you can support both positions at once?

Makes one go 'Hmmmm' now doesn't it...?

This is going to get interesting....

Either you are in or you are out.

[AndrewMensch]

The market is being assisted by the First Time Credit... now IS a great time to buy, but the credit is there to incentivize buying and spur economic activity beyond the sale.

[SVTLightning]

Its just a sales gimmick.

Do you really think the NAR is going to say don't buy now? lol Realtors only make money off of people when they buy/sell. So of course they are almost always going to say it's a good time to buy, or its a good time to sell. They alternate so it sounds different of course lol.

[middle-aged mom]

I do not invoke the one size fits all approach towards anything.

[middle-aged mom]

Originally Posted by SVTLightning

Its just a sales gimmic.

Do you really think the NAR is going to say don't buy now? lol Realtors only make money off of people when they buy/sell. So of course they are almost always going to say it's a good time to buy, or its a good time to sell. They alternate so it sounds different of course lol.

All advertizing is done to persuade consumers to buy the product, whatever the product is. As consumers we all pay for the cost of having said product marketed to us. As consumers, we decide to buy or not and those who buy, trend towards comparison shopping.

As it relates to real estate, why would anyone think the trade association representing more than 1 million agents suggest anything other than buying? Does anyone expect the NRA to advocate eliminating guns just because a heck of a lot of people get killed by gun shot, every day.

I do not advocate that now is a good time to buy, for everyone. I am far more inclined to recommend that those sellers who do not have to sell and are not willing to do so at what the m,market will bear, withdraw from the market.

[Belinda5]

Great question!
If you need a house it is always a good time to buy. If you need to sell it is always a good time to sell. Do your homework for the market you are currently in, and make the best decision for the moment. Buy wisely. You cannot time the market. You can only know the "bottom" of a market in "hindsight" and then it is too late.
Buy when you are financially ready, the incentives are there to help because of the fear in the market and on-going foreclosures. Yes the market is bad compared to other years, but now is a good time to buy if you are able, and need a house. It is not a great time to sell, but if you need to sell, it IS the best time to sell.

The NAR ads speak from past experience. Over the long term, it is best to buy when the market is "down". And when you have the incentives such as those from builders or the tax credits, even better.

I have been a Realtor for 20 years and have been through two bad real estate markets. When the market goes up, you always regret not buying during the doom/gloom periods. When the market goes down, you regret buying at 100% financing and then have to sell at a loss, due to a job loss.

The incentive is there to stimulate those buyers who are "afraid" to jump in. Also, interest rates are really good right now. Real estate is ALWAYS for long term investing. You have to pay for housing whether it is rent or mortgage costs. It is about lifestyle and values. Just don't buy something you cannot afford; try to put a downpayment iin case you need equity to sell in the short term (due to job loss or relocation) and happen to go down.

Personally, I have never bought with less than 20% down. There are few cases where 100% financing is a good option. That's my philosophical belief. You should expect Realtors to guide you through buying and selling that are a win-win for all. True, we only get paid on a sale, but our careers are dependent on repeat business due to great service and professionalism.

To be honest, many Realtors are struggling now, with the same question you posted here. However, the seasoned Realtors who survived previous recessions will have the 'long term' view that this market is a good time to buy. The economic gurus and news media affect the midset of purchasers, and NAR is trying to remind people that low interest rates, tax credits, declined prices etc. make a good environment to buy...if you are ready, and able.

Pushing to extend the tax credit gives us one more "sales tool" to help buyers who otherwise would not be ABLE to purchase. Many buyers do not need the tax credit and they would have bought due to the low interest rates and prices.. No one likes a declining real estate market, so the tax credit helps bring more buyers into the market; we have to do our best to prop it up. So, yes, we Realtors don't want it to tank further. No one does. That does not mean it is not a good time to buy. Perhaps for a short term investor, or someone with unstable employment, now would not be a good time to buy. But neither is the "peak" of the market for those same buyers.

[Sandy Nelson]

The rule goes: "Buy low, sell high".
In our area prices are low, inventory is high and interest rates are low.
There's no guarantee that prices or interest rates will not fall lower, and there are plenty of people sitting on the fence waiting to see what happens. Essentially they are waiting for prices to go up before they commit to buying.
The first time home buyer tax credit helps motivate people to get off the fence.
I'm under contract to buy another property and wish I had more money to invest in real additional estate.

[rubber_factory]

Originally Posted by Belinda5

True, we only get paid on a sale, but our careers are dependent on repeat business due to great service and professionalism.

I think your careers are more dependent upon the barrier-to-entry that the NAR/MLS provides you.

[MMichelle]

NAR is a biz. org. - not a religion. You must understand that like all such biz. orgs. not all members march in lock step nor worship their every position on every issue.

My position is as follows.
I work (mostly) with investors, so the first time home buyer tax credit has no effect. Thus it had no impact on my business. Note the credit was only app. for 1st timers and it had to be for a primary residence.

As it happens I sold my home and bought another - of course the tax credit did not apply to be personally.

I think anything that can help jump start the economy is fine - if it works. The tax credit that is now days away from expiration has had an effect - the national stats bear that out. However, I didn't understand why first time home buyers were targeting for the credit. Addionally, "first time buyers" were defined as anyone who has not owned a home within 3 years.

While congress considers extending the credit they are considering including those who sell a home and buy another - the credit is suggested at $6,500 for that group. If congress had bothered to ask me (LOL) I would have suggested an accross the board tax credit of $5,000.00 for all home buyers (first time or not) providing they are making a min of 10% down payment. But then, no one asked me!

Each market is different. As they say all real estate is local - it's very true. That said, in our market it's a very good time to buy - interest rates are very low and prices are very modest. Our inventory has tightened (we have about 1,500 few homes on the market vs. the same time last year), so it can take longer to find a house.

You see, I have taken my own advise. I purchased a home because it was a great time to buy. I could have never purchased the home I did 2 years ago. I got a great price - it was a good opportunity! Frankly, I hated to sell my "old" home. It's not a great sellers market. If I had been able to swing it - I would have rather kept the old house and would have kept it as a rental. But, it was important to me to move the cash to the new house. I don't want to be house poor! So sell it I did.

Our market is tightening up. Prices are still reasonable - bargains are still out there but they are taking more work to find.

Thanks for asking.