Written by Ivie K Baker - January 26th, 2010There is a long list of reasons why NOW is a great time to buy real estate! The stars and planets have aligned and the real estate environment is in the perfect position. Well, maybe that’s a little exaggerated, but you’ll never see a better time to buy a home or property.
According to many real estate experts, most believe that we have seen the bottom of the market and sales are going to start to up-tick in 2010. Of course, we aren’t going to see those soaring real estate prices for a long time, but we should start seeing some markets appreciate in value across much of the USA.
According to an article in the January 2010 National Association of Realtors Magazine, (Easier Money, Steadier Sales), one expert predicts that we could see existing home sales raise by 13.6 percent in 2010. That’s great, considering that in 2009, we only saw an estimated 2 percent increase over 2008.
So, why should YOU buy now? There are several very valid reasons. If you are a first time home buyer, you may be eligible for the $8,000 tax credit, if you purchase a home before April 30th, 2010 or have a valid purchase agreement signed before April 30st 2010 and the sale closes on or before June 30th, 2010. If you are a current home owner, you may be eligible if you have used the home being sold or vacated as a principal residence for five consecutive years within the last eight! To find out more about the Home Buyers Tax Credit, visit http://www.irs.gov/newsroom/article/0,,id=204671,00.html
There are other key factors that make this a great time to buy! Home and land prices are at a recent all time LOW. In most markets, prices have already hit bottom. Experts say that we should start seeing prices appreciate in the near future. As real estate sales start in increase, prices will stabilize and many markets will start to see a subtle rise in price as consumers decide to take the plunge and take advantage of the market.
Along with the lower housing prices, mortgage interest rates are still holding very low. This is key for enticing buyers into making a purchase in this market. Obtaining a new mortgage is also getting a little easier too. When the mortgage crisis first hit and HVCC (Home Valuation Code of Conduct) was put into place, we saw some very poor and inaccurate appraisals surface. This was due to the insane regulations that were put on the appraisal market. Lenders were forced to use third party referral companies to order their appraisals and in many cases, appraisers were sent into areas where they were unfamiliar with the local market. This resulted in low and inaccurate appraisals.
Since then, other regulations have been put in place to allow only appraisers who are familiar with the local markets, to do appraisals in those areas. This has improved the quality of the appraisals being done throughout the nation, making it a easier for buyers to secure a mortgage.
Currently, there are several programs out there to help lower income families purchase a home. FHA is also lightening up their restrictions and now allowing some manufactured home purchases though their program. In my Michigan market, there are still programs, such a USDA Rural Development and MSHDA (Michigan State Housing Development Authority) programs, to help make owning a home affordable for many Michigan families.
Find out more about these programs here:
USDA Rural Development: http://www.rurdev.usda.gov/mi/
MSHDA: http://www.michigan.gov/mshda
For second home buyers, there are still advantages to buying in this market. The biggest advantage is, that prices have come down and interest rates are still low; even for second home purchases. In my local market (Clare/Gladwin Counties, MI), even waterfront homes have come down in price between 1/4 to 1/3, compared to two years ago.
Many second home buyers are finally taking advantage of the decreased prices to purchase a vacation home, which may have been out of their price range several years ago.
Also, contrary to popular belief, there are lenders out there, who will mortgages on second homes with just 10% down. I personally recommended one in particular lender, who has closed several deals for my clients in the past 6 month, with just 10% down. This has created additional sales that may have not come together, considering that most lenders are now requiring a minimum of 20% down for this type of purchase.
Vacant land is also easier to buy. With just 15% down with a good credit score, many buyers are purchasing vacant lots and acreage with reasonable down payments and fixed mortgage terms, stretching out as long as 30 years. For vacant land purchases, the closings tend to happen much faster than a home purchase, with an average turn around time of just 2-3 weeks.
So, if you’ve been thinking about purchasing a home or land in the near future, now is the time to do it. Combined with low interest rates, low real estate prices and flexible lending programs, you can’t go wrong in this market!
According to many real estate experts, most believe that we have seen the bottom of the market and sales are going to start to up-tick in 2010. Of course, we aren’t going to see those soaring real estate prices for a long time, but we should start seeing some markets appreciate in value across much of the USA.
According to an article in the January 2010 National Association of Realtors Magazine, (Easier Money, Steadier Sales), one expert predicts that we could see existing home sales raise by 13.6 percent in 2010. That’s great, considering that in 2009, we only saw an estimated 2 percent increase over 2008.
So, why should YOU buy now? There are several very valid reasons. If you are a first time home buyer, you may be eligible for the $8,000 tax credit, if you purchase a home before April 30th, 2010 or have a valid purchase agreement signed before April 30st 2010 and the sale closes on or before June 30th, 2010. If you are a current home owner, you may be eligible if you have used the home being sold or vacated as a principal residence for five consecutive years within the last eight! To find out more about the Home Buyers Tax Credit, visit http://www.irs.gov/newsroom/article/0,,id=204671,00.html
There are other key factors that make this a great time to buy! Home and land prices are at a recent all time LOW. In most markets, prices have already hit bottom. Experts say that we should start seeing prices appreciate in the near future. As real estate sales start in increase, prices will stabilize and many markets will start to see a subtle rise in price as consumers decide to take the plunge and take advantage of the market.
Along with the lower housing prices, mortgage interest rates are still holding very low. This is key for enticing buyers into making a purchase in this market. Obtaining a new mortgage is also getting a little easier too. When the mortgage crisis first hit and HVCC (Home Valuation Code of Conduct) was put into place, we saw some very poor and inaccurate appraisals surface. This was due to the insane regulations that were put on the appraisal market. Lenders were forced to use third party referral companies to order their appraisals and in many cases, appraisers were sent into areas where they were unfamiliar with the local market. This resulted in low and inaccurate appraisals.
Since then, other regulations have been put in place to allow only appraisers who are familiar with the local markets, to do appraisals in those areas. This has improved the quality of the appraisals being done throughout the nation, making it a easier for buyers to secure a mortgage.
Currently, there are several programs out there to help lower income families purchase a home. FHA is also lightening up their restrictions and now allowing some manufactured home purchases though their program. In my Michigan market, there are still programs, such a USDA Rural Development and MSHDA (Michigan State Housing Development Authority) programs, to help make owning a home affordable for many Michigan families.
Find out more about these programs here:
USDA Rural Development: http://www.rurdev.usda.gov/mi/
MSHDA: http://www.michigan.gov/mshda
For second home buyers, there are still advantages to buying in this market. The biggest advantage is, that prices have come down and interest rates are still low; even for second home purchases. In my local market (Clare/Gladwin Counties, MI), even waterfront homes have come down in price between 1/4 to 1/3, compared to two years ago.
Many second home buyers are finally taking advantage of the decreased prices to purchase a vacation home, which may have been out of their price range several years ago.
Also, contrary to popular belief, there are lenders out there, who will mortgages on second homes with just 10% down. I personally recommended one in particular lender, who has closed several deals for my clients in the past 6 month, with just 10% down. This has created additional sales that may have not come together, considering that most lenders are now requiring a minimum of 20% down for this type of purchase.
Vacant land is also easier to buy. With just 15% down with a good credit score, many buyers are purchasing vacant lots and acreage with reasonable down payments and fixed mortgage terms, stretching out as long as 30 years. For vacant land purchases, the closings tend to happen much faster than a home purchase, with an average turn around time of just 2-3 weeks.
So, if you’ve been thinking about purchasing a home or land in the near future, now is the time to do it. Combined with low interest rates, low real estate prices and flexible lending programs, you can’t go wrong in this market!
Copyright 2010 - Ivie K Baker
2 comments:
Thanks for posting this Ivie. It will be a big help for me to try to explain the benefits of owning a home to my nieces. I wish they had classes about home buying, but I'm doing my best! I'm lucky to have a Mom that was a Loan Officer before she retired. I'd never dream of renting. Off to take one of my nieces to lunch and show her a house in our city (downstate) that she can easily afford...if she will make the step. As always, if you ever need someone to tell your clients how much we LOVE the Clare/Gladwin county area you can always count on us. :)
Thanks Denise. I'm glad that you found the article useful. I really think we are going to have a good year!
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