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Helpful tips on today’s real estate market
May 18, 2008 by admin · 16 Comments
In today’s housing market, we all know how important it is to get buyers and sellers back into the game. Unfortunately, the media’s continued focus on negative real estate news is keeping many people solidly on the sidelines. But remember, these people aren’t getting the whole story. And the facts they’re missing can alter their mindsets. All we have to do is put those facts out there!
Fact #1: Some six million Americans are expected to buy a home this year. Six million people in the game make up a pretty big game. That’s a level of sales equal to the one we experienced in 1998—by all accounts, a pretty good year.
Fact #2: There is still over $23 trillion of value in u.s. housing stock. Home ownership continues to be the basis of our wealth in this country.
Fact #3: The housing market cannot help but grow. Our country’s tremendous wealth, liquidity, and entrepreneurship will continue to drive our economy. 70-100 million people will be added to our market in the next 40 years.
Fact #4: Real estate is cyclical. The biggest fear in good times is that the fair weather won’t last forever—because it doesn’t. But the reality of a cyclical real estate market also provides its brightest hope in bad times—foul weather won’t last forever either. What’s happening today is a market correction, severe in some places, but it’s not the end of the world. As shown by Fact #1, people are still buying and selling homes. The markets will stabilize.
Fact #5: 2008 is the best year to buy a home in 35 years. 1973 was the last time mortgage rates were this low in a buyer’s market. We had rates this low in 2001 and 2002, but those were strong seller’s markets with little inventory. The last two big buyer’s markets, in the early ‘80s and early ‘90s had much higher rates. Low rates and good inventory make 2008 the best year to buy in decades!
Fact #6: First-time buyers have a real advantage in today’s market. First-time buyers can buy at a reduced price without having to sell at one too. Higher limits on lower cost conforming loans also help first-time buyers purchase more home for their money. Today’s ‘starter’ homes can be pretty impressive.
Fact #7: First-time buyers lose money while they wait on the sidelines. First, renters typically pay more state and federal income taxes than homeowners with a mortgage deduction. Renters are also losing the wealth they could be accumulating as they pay down their mortgage and as their home increases in value over time (as it surely will). Lastly, renters who wait to buy will lose money if interest rates increase by the time they finally act. Higher payments from higher interest rates represent money buyers could have kept if they had bought earlier. Conversely, if they were willing to spend that amount of money earlier, they could have bought more home.
Fact #8: Homes sell when they’re priced right and show well. Buyers are looking for value in today’s market. When sellers make their home’s value obvious, they make a sale—it’s as simple as that.
Holly White has been in Real Estate related industries going back to 1995 and has experience in not only real estate sales, but also in mortgage finance and real estate appraisal. Holly has a huge love for music and moved to Nashville in 2003 to further progress a family business in the music industry and open a recording studio on Music Row called Sixteen Ton Recording Studios. During that time she has also managed to take Nashville by storm in real estate with RE/Max Elite.
I agree it is still a great time for renters to buy their first home. Don’t throw away all that money each month.
Renters are also losing the wealth they could be accumulating as they pay down their mortgage and as their home increases in value over time (as it surely will). Lastly, renters who wait to buy will lose money if interest rates increase by the time they finally act. Higher payments from higher interest rates represent money buyers could have kept if they had bought earlier. Conversely, if they were willing to spend that amount of money earlier, they could have bought more home.
I agree with you completey. Why does the media do that? Fortunatly are market area isn’t is bad as rest of the country. I think its a great time to buy in our market prices are down, there are short sales out there that are good buys…
Tips are as they were before, get lender pre-approved and try to make sure the loan program will not be discontinued if you close on the 10th. I heard some inevstor programs are being cut by 10% LTV in August. it is getting hard out there folks…we’ll al be relieved when some programs come back.
I think sometimes people forget that more often than not buying a home is a long term investment and that even though the market is low at the moment, it won’t stay low for the long term.
Its good to see someone pointing out the positives of the real estate market. People to often focus on the negative when there really are some very bright spots in the market.
Great post! This is just a bump in the road and as you point out this is needed product. All is well fr those who focus and stay in the game
lots of great points. Many people I am afraid are to busy letting the news get to them. We are working hard to overcome the fears of the consummer when “there is noting to fear but fear itself”
We just ahve to keep the good news flowing strong
I totally agree with you James. My brother said the same thing as you said.
I think the buyers are there but it’s going to be harder for them to qualify or find the amount of money they will need. There are a lot of people whose credit will not meet the requirements and saving money right now is harder for many people. I think business will be different for awhile but will straighten out in the coming year.
Agree : the best way to save and in some cases increase your capital is investing in the real estate! And the best time to do this is NOW!
Greetings from Spain.
I couldn’t agree with you more. Sure home prices are down, but this is one of the greatest times to be buying home in our history. Between the great deals available and the low interest rates, people should be excited about buying. I know there are some really great values for Buckhead and Atlanta homes.
Yeah, media has this style of “over-exaggerating” stuff that really put people into panic mode. People are still capable to pay their rents or buy houses because they are earning, no one gets jobless here…it’s just that money is not that high compared to years back. But hey, it’s not the end of the world. The real estate industry/market is still being considered as one of the liveliest market nowadays.
But it is better that we know what is really happening in our world right now. The media is just there to report, it is up to us to decipher whether it is pure overreaction or plain facts.
cheers to all the real estate agents!
“Fact #3: The housing market cannot help but grow. Our country’s tremendous wealth, liquidity, and entrepreneurship will continue to drive our economy. 70-100 million people will be added to our market in the next 40 years.”
YUP, THAT SHOULD BE THE SPIRIT IN MARKETING HOUSES. WHETHER WE LIKE IT OR NOT, THERE ARE CHANGES WE HAVE TO ADAPT IN ORDER FOR US, AGENTS, TO SURVIVE IN THE JUNGLE OF REAL ESTATE BUSINESS.
come and visit: http://www.realestateleadsource.com
For me, the real estate industry or the housing business is one of the best sources of income as seller or real estate agent. Houses are something that never depreciate, and people really do look for homes to stay.