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We just bought a home in Crofton, MD, which is a very hot market and has been for years. We beat out 4 other offers to get this home and we got a great deal on it. It is in a very popular neighborhood with the top public schools. I have a stable job with the Federal Government and most of the people who live and work in Crofton, MD are military, Federal Employees in DC, or Contractors.
Our closing is on 4/6 and we are wondering if we made a mistake buying a home right in the middle of this virus crisis. We did get an amazing rate at 2.9%. Do you think in an area like Crofton, we will experience a significant drop in real estate values, or if we do, will it bounce back? Any thoughts if this was a bad time to buy?
Given your circumstances, the area, and the LOW interest rate, I think you did great and should close as scheduled. Think positive. Nobody has a crystal ball, and this, too, shall pass!
NOBODY has a secure and steady job with this virus. Insecurity reigns for now and the next 18 months until there is vaccine. All I am seeing are price reductions and 'back on market' in areas had been contemplating a purchase. I won't buy until I see more data on reductions and have a sense they are near bottom...likely in 2 years.
would you say that government employees have secure and steady jobs?
healthcare workers?
pharma workers?
medical device employees?
Microsoft, google, Facebook, etal - information systems workers?
Surely, there will be a % of the population that will be insecure until a vaccine is developed. I don't think anybody knows that %. We don't question folks "did you get the flu shot this year?"
NOBODY has a secure and steady job with this virus. Insecurity reigns for now and the next 18 months until there is vaccine. All I am seeing are price reductions and 'back on market' in areas had been contemplating a purchase. I won't buy until I see more data on reductions and have a sense they are near bottom...likely in 2 years.
I disagree with you. I would say being a federal civil service employee is about as secure as you're going to get in this environment. It will be a cold day if the federal government need to reduce employees due to budget cut. It's not going to happen politically. Not when the administration is pumping in TRILLION of dollars to keep the economy afloat.
As I said in my post, people just can't put their lives on hold waiting for the bottom in housing prices. If OP is willing to put down root and have a long term plan, buying now may be the right decision for him. People buy homes, get married, have babies, despite the economic cycles. Life goes on.
Convince me why now is still a good time to buy? Why shouldn't buyers wait? Don't you think there will be a price drop? Even in cities with low inventory, why should buyers rush to buy?
With 25 to 30% unemployment, I'm sure that low inventory city will open up and create more homes on the market no?
Unemployment rates higher than during the Great Depression? Highly unlikely.
Yes, I know the head of the STL Fed Reserve said it.
Even if the market does go down Real Estate will always recover. You are getting an opportunity at historically low-interest rates so take advantage!
It took OVER ten years for the last real estate crash to recover. And in some areas it still hasn't, prior to virus. Not everyone can wait 10 years. Even people who ***think*** they will stay in a home for 10 years often don't. Job transfers, divorce, medical bills, disability, loss of job.
the Case-Shiller took 10 years to get back to its prior peak.
som places it didn't take as long.
some places it took longer or as frannie says, hasn't yet fully-recovered.
I'd say that the simplest "measure" would be compare an area's median wage to the US average over time. There's surely a solid correlation between income and house values.
The economy and business outlook is shaky. People who **think** their jobs are secure, think again. How business is conducted in the foreseeable future is about to change drastically. Not everyone laid off will be rehired; not everyone working will continue to have a job. Businesses will start adjusting soon...time will tell how many jobs are truly secure, and for how long.
I wouldn't buy a house now. Wait and see how things play out at least in 3 month increments. This virus is not done with us!
What government does makes a difference. Regarding buying and raising a family, that is very short sighted. For example if you purchase a house at 600k, 3% interest rate, you will pay 310k in interest in those 30 years. On other hand if you waited and gotten at 500k, it will only cost 259k in interest rate. Yes you can raise your family in that house for the next 30 years but how much it will cost does ultimately makes a difference for most people
This assumes that the interest rate is the same. It never is.
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