Is It A Good Time To Buy A Home?

So many reports, surveys, and opinions. I try to read them all so I can be informative and the majority of the top experts believe it to be a resounding, YES!

According to a Gallup Poll study, “In U.S., Majority Still Say Now Is a Good Time to Buy a Home.” If you feel the time is right for your needs and you've found that special dream home, why wait?  Even if prices should soften a little more, I don’t believe ‘users’ are buying homes to sell them in a year. The average homeowners stay in a home 5-7 years out, and can be maybe worth 20-30% more.  Many still feel that home ownership is still the best investment with the most potential. 

Interest rates have increased almost 3/4 of a point in the last six months. Many of the experts still are expecting rates to continue to rise through the year, too. Even with home prices softening and the interest rates rising, it may be less expensive to buy now, rather than wait.  A small hike in the mortgage interest rate can impact your monthly payment substantially over the long run. (Don't forget interest rates along with price determine the overall cost of a home). 

However, Lawrence Yun, NAR chief economist, said the market is underperforming.

“Given the great affordability conditions, job creation and pent-up demand, home sales should be stronger,” he said. “Although existing-home sales are expected to trend up unevenly through next year, unnecessarily tight credit is continuing to restrain the market, along with a steady level of low appraisals that result in contract cancellations.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.84 percent in April, unchanged from March; the rate was 5.10 percent in April, 2010. Lenders are lending at a healthy pace. While interest rates continue to cooperate, there are many programs for customers. Of course, lenders only approve borrowers that can demonstrate their ABILITY to repay (via income verification), and their WILLINGNESS to repay (via credit scoring and automated underwriting systems).

Phil DeMuth, an investment adviser and the co-author of a new book on investing, The Little Book of Alternative Investments, says it's a great time to buy.

"Housing prices are where they were in 2002 and you've got mortgage rates at 5% now on a 30-year mortgage," he says. "If you can put the 20% down and qualify for a good mortgage, I'd say this is an excellent time to take that kind of position."  See full article from DailyFinance: http://srph.it/fQRult

With, foreclosures on the rise, home prices softening, high inventory, and low interest rates, there has never been a better time to buy. In nearly 60 years we have never had BOTH record low home prices and low % rates at the same time.

Barbara Corcoran, real estate icon said, “We have a regular real estate miracle happening right now. We not only have record low prices, but we also have cheap money.”

A second real estate icon, Donald Trump said, “This is a great time to go out and buy a house. And if you do, in 10 years you’re going to look back and say, ‘You know, I‘m glad I listened to Donald Trump’.”

Hedge fund manager John Paulson became an icon in the investing world when he made a huge wager against subprime mortgages in 2007. That year, his funds gained as much as 590 percent, according to the Wall Street Journal.

 “If you don’t own a home, buy one,” Paulson said. "If you  own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home.”

Maybe it’s time to start listening to the people who have made their fortunes buying and selling real estate. They may know best!