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In October, I wrote a blog called Doom and Gloom. Just
recently, I have received a couple of comments that set me to thinking and
blogging.
The first comment was “Did I still believe that it is the
right time to buy?” Yes, I do. Interest rates are at an unbelievable low. I
thought I did really well a number of years ago when I got 5.375%. I didn’t
figure that I would ever refi again. Now I’m waiting and watching, looking for
something in the low 4’s. Fixed rate, of course. Another reason for buying is
that there is a glut of homes on the market. In Lansing,
we have about a 10 month supply of homes. For those of you that are not in the
real estate market, that means at the current rate that homes are selling, it
will take 10 months to sell everything that is currently on the market. That
means that there is a great selection. Over 70% of the homes in Lansing
that have sold were either foreclosures or short sales. That means that there
are great bargains out there. Someone will buy these homes, probably at a
greatly reduced price. Shouldn’t it be you? Whether you are looking for a home
to live in or want to invest in rental property, you couldn’t find a better
time to buy.
The second comment was that “I had predicted the bottom of
the decline in October and then again in March. Eventually, I would get it
right.” I didn’t predict anything, but it got me to thinking. Maybe, they
believe that you only buy at the bottom of the market. The problem with that
type of thinking is that you never know where the bottom is until you are on
the other side of it with homes prices going back up. I wish I had a crystal
ball that would enable me to see the future. I would have picked the correct
numbers for one of the multi-state lotteries.
It’s simple. If you want to own a home, then you need to buy
a home. You need to look at everything in your price range plus a little bit
higher. Work with an agent that knows the area. One of my buyers just closed on
a wonderful home in Fowlerville for $68,000. We had looked at everything in
their price range and area. We even drove to Howell (30 minutes away) to look
at a house that we stayed in just long enough to look in the basement (4’ of
water) and leave. When we found the home in Fowlerville, we wondered what was wrong
with it. It had newer vinyl windows, siding, dimensional roof, furnace,
beautiful refinished hardwood floors, original trim and doors, appliances, 1.5
baths, great curb appeal and a reasonable kitchen. All for $68,500. Even the
paint colors were acceptable. There was nothing wrong with it. It was a GREAT
DEAL!!! Most of what we looked at was foreclosures or short sales. And along
the way, we saw other great deals; really nice homes at really nice prices.
Several of the homes had multiple offers on them.
Values are declining and will continue to decline until the
current inventory of foreclosures and short sales are gone. But should you wait
until we reach the unknowable bottom. I don’t think so. Could you pay a little
more than what you would at the absolute bottom of the market? Possibly. Could
you miss that one home that you wanted? Probably. Your choice. My husband and I
are buying.