What Time Is It When a Homebuyer Sits on The Fence?

It is not time to buy a new fence — it is time to buy the home behind the fence.

Real estate values are based on location, location, and timing.  We are told by the media that real estate is in a bad place and therefore to buy now is a losing proposition.  It is no further than the truth.  Like in the stock market, who buys when stocks are high?  But when do the most savvy buyers buy?  I do not need to declare the obvious.

Looking at today's market there are 3 major factors that are contribute to the positive for today’s buyers:

1.  It is a buyer’s market.  Homes on the market are languishing.  According to the National Association of Realtors (NAR), Northeast listings declined 2.5 percent to an annual level of 770,000 in May and are 13.5 percent below May 2010. The median price in the Northeast was $241,500, up 6.1 percent from a year ago, which would be a somewhat interesting dichotomy, if not the number of listings being down.  Morris County has been stagnant, with communities on train lines faring little better than those that are not.    

2.  Mortgage rates are ideal for buying, hovering at 4.75%.  In other words, the cost of owning a home is at one of the lowest levels it has ever been.  For every 1% raise in interest rates, 8% of buyers are out of the market.  Although guidelines for obtaining mortgages are much tighter, mortgages are being issued.  

3.  Homeownership has been — and continues to be — one of the best financial investments.  If you bought your house in 2000, it would be worth approx 35% more today.  And unless you plan on selling the home you bought this year, next year, it will continue to rise in value. Compare that to what the stock market has done since then. (Nonetheless, the mindset of owner-occupant homeownership needs to change as it is.  A home must be considered a home and not just a house, as it is tangible in which shelter is found as well as a life and lifestyle, rather than just an investment.)

To get a better understanding of today's market and entire purhasing process, Investors Savings Bank is sponsoring a FREE Home Buyer and Mortgage Seminar on Wednesday, June 29, from 1:00-1:45 p.m. at its branch office located at 16 Waverly Place, Madison.  Lunch will be served and RSVP is requested by calling or emailing Caitlyn Brown at 908.625.0368 or cbrown@isbnj.com.

This free seminar is the perfect start to purchasing a home.  It will give a buyer the information needed to overcome  today’s mortgage climate, as well as the steps in the buying process. There will also be time to ask questions and get the answers from experts Caitlyn Brown, ISB Loan Consultant, and myself.

The real estate market is cyclical, there are sellers markets and buyers markets.  If you are looking for that seller market to come back then get comfortable on that picket fence and sell when either you need to sell or if you want to take advantage of today’s buyer’s market.  And for you buyers, why wait for that fence to break with your fellow fence-sitters.  There more informative one is, the better stance one will have when they are ready to buy.  Get out there and buy before it is too late.

Jeffrey David Halpern          
Vice President-Branch Manager                                                                                                          Coccia Realty, Inc.                                                                                                             jeff@mycoccia.com