Why Buy Now?

Hi Lesslie,
I’m confused about something. I am a buyer who is ready to buy. Many of my friends tell me that I should wait to buy, because it is likely that with more foreclosures coming on the market, prices will continue to drop. What do you think about this? Charlie B.

Hello Charlie,
My answer and the answer of many others would be to buy now. We know that the percentage of home ownership is dropping but there are so many advantages to buying your own home, and particularly at this time. Here are just a few reasons:

The inventory is good right now and you should be able to get a good deal. The tax credits are over, so there are fewer buyers out there and you should also be able to find the right house, in the right location, for the right price. It is a Buyer’s market. If you have kids and a preferred school system, this is an opportunity to find a house in that district. Since the peak, prices have come down in our area 25 to 30%.

Mortgage interest rates are the lowest in 40 years—the rates are artificially low and now is the time to take advantage of that. You could wait for pricing to come down, but if rates go up, even a half to one percent, the benefit is lost, and you may have lost your opportunity. There are interest rates in the 3s and 4% range right.
For a conforming loan up to $417,000, with one point, many lenders are quoting 4.25% interest rate. With ½ a point up front, quotes are at 4.375%. Rates are simply unbelievable low.

Another reason to buy is that owning a home may cost you less than renting when all is said and done. You can deduct the interest paid on your loan from your income taxes and the property taxes can also be deducted. There is a great tax benefit for owning.

Owning your home will force you to save. You’ll be building equity in your home. And sooner or later, the market will get better and you’ll find your equity really building up.

In addition, you will be “vested” in your home. It’s yours. You can do what you want with it. You can make any changes you desire, and most likely, you’ll have a better home than the one you could rent. By remaining in the same home you become vested in and a part a neighborhood. You count in neighborhood decisions and with your neighbors. They know you are there for the long term.

In response to an article in Time Magazine, Brett Arends wrote about the 10 reasons it’s good to buy.
Check it out at: http://tinyurl.com/2dmvt6a. Remember, if you have any questions about the Real Estate or the Market, email me at Lesslieg@aol.com or call 714-608-6646

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