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You need to ask on your local forum as home prices are local, not national. What is going on in the Detroit or Charlotte markets has ZERO bearing on a home in, say, Houston, and even within Houston, some suburbs and in-town neighborhoods may still be rattled with foreclosures and short sells while others are climbing or steady in prices.
Why do you want to know? Trying to pick the bottom?
Just look at it this way, if you are looking for a home: Housing prices are a LOT lower than they were a few years ago. Is it the bottom? Probably not. Is it closer to the bottom than it was a few years back? Definitely.
You, nor i, can't pick the bottom, and more than likely prices will turn when it is least expected, for no apparent reason whatsoever. That's the way things happen.
If deals make sense with today's prices, be it investment, or a personal home, then do the deal. If you get some appreciation out of it, then consider that the icing on the cake. It may turn out that even when the bottom is made, there will be no appreciable price increases for years following.
Or prices may double in quick order as all of the people who are waiting to buy read on the cover of Time Magazine that the bottom is in...and of course, it will be too late!
It applies to lots of stuff that fluctuate in price like commodities, stocks, bonds.
I never care if I bought at the bottom.
I only care if I picked a price that is undervalued and went up later on.
People that want to buy a house now, but are waiting for "the bottom"
are kind of like people waiting for a "bottom" in computer prices.
If it makes sense for you now, buy it.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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The region does make a big difference. The prices here have started to go back up
over the last few months, but that doesn't mean they won't fall again in the future.
Buy when you can afford a house that suits you to live in.
You also need to consider that with rates being so low, unless you intend to purchase with cash it may very well be less expensive to purchase now then when they increase.
At least in Baltimore it seems like we've hit pretty close to bottom and are on the uptick again. There are hardly any foreclosures in many of the homeowner occupied neighborhoods as investors have picked most of them up.
In my area, we have been what I call "bouncing on the bottom" for almost a year. One month, prices are up, the next month, they are down, we have an increase in sales for 3 months, then it drops again for the next 2 months. I don't anticipate further significant drops for my area, but it also could be another year before we start to see any sort of increase.
You also need to consider that with rates being so low, unless you intend to purchase with cash it may very well be less expensive to purchase now then when they increase.
.
This is what I would focus on the most. Just to put some numbers to it...
Let's say a house is $250K right now. If the market goes down 10%, the price will be $225K. But you don't know you've hit bottom until it starts going back up, so if it raises back up 3%, the house is now 232K.
Rates are about 4.25% right now. They are at all time lows and only have one way to go - up. And that will happen as soon as we see the bottom hit and prices go back up.
If you buy the $250K house now, your payment is $1,229 monthly for a 4.25% rate.
If you buy the $232K house once you know the bottom has hit, your payment at 5.25% would be $1,279. So though you waited for the bottom, you could be paying more.
The other thing to watch is that there are MANY buyers out there waiting for the bottom to hit before they buy. When it becomes obvious the market is recovering, you will be competing with all the other buyers such as yourself.
This is what I would focus on the most. Just to put some numbers to it...
Let's say a house is $250K right now. If the market goes down 10%, the price will be $225K. But you don't know you've hit bottom until it starts going back up, so if it raises back up 3%, the house is now 232K.
Rates are about 4.25% right now. They are at all time lows and only have one way to go - up. And that will happen as soon as we see the bottom hit and prices go back up.
If you buy the $250K house now, your payment is $1,229 monthly for a 4.25% rate.
If you buy the $232K house once you know the bottom has hit, your payment at 5.25% would be $1,279. So though you waited for the bottom, you could be paying more.
The other thing to watch is that there are MANY buyers out there waiting for the bottom to hit before they buy. When it becomes obvious the market is recovering, you will be competing with all the other buyers such as yourself.
I think its already bottomed out becuase the FED already loans the money to banks at 0% and I will never see a day in my life where the banks actually lend money to indiviuals at 0% so its not getting any lower. If it goes any lower we are in for some hard times because alot of peoples wealth will disappear and there will be even more loan defaults, you think OWS is bad just wait until at 300k home is worth 20 grand if thats what your hoping for, your 20 grand home wont seem so sweet anymore when your dealing with all the other social problems that will simultaniously occure.
I would be getting my passport ready and looking for work overseas if it slips much further.
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
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Quote:
Originally Posted by Ted Bear
...If deals make sense with today's prices, be it investment, or a personal home, then do the deal. ...
I agree with this ^^^^ You will not be able to time the bottom, so buy when AND ONLY WHAT IS right for you (costs / rates).
Quote:
Or prices may double in quick order as all of the people who are waiting to buy read on the cover of Time Magazine ...
I don't predict this will happen to personal realestate, but potentially a significant bump to commercial. Many Folks don't have lots of money, many companies (and dirty banks) are flush with cash and LOTS of it. Personal Real Estate wil PROBABLY climb slowly, but as mentioned the financing costs will likely not be more favorable than now.
I try to ONLY buy 30% BELOW CURRENT market, be it good or bad. You make your money when you buy, not when you sell. Remember it costs a minimum of 10% to sell (even on your own). AND there are many lost opportunity costs to buying wrong realestate investments. (Way too capital intensive to be considered 'flexible'. )
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