Buying a Home in a Buyer’s Market

When is the best time to buy a house? With many markets reporting an abundance of homes for sale, and interest rates remaining at near historic lows, now might be one of the best times in recent memory. While today’s real estate market does offer advantages to buyers, consumers still need to be savvy in order to get the best deal they can.

What follows is some valuable home buying information that we at Coldwell Banker Grass Roots Realty think every home buyer should keep in mind.

Don’t Try to Time the Market. When home prices are lower, it is very tempting for potential buyers to try to wait as long as possible in the hopes that prices will decline even further. This strategy can be detrimental because when there is high inventory, smart sellers price their homes properly, not according to past sales but according to current conditions, so their homes will sell in a timely fashion. Once a home is priced to what the current market will bear, buyers will make offers.

Shop Around. But Don’t Wait Too Long. The National Association of Realtors reports that homes are staying on the market for several months. Recent increased inventory gives home buyers a great opportunity to compare homes that meet their needs. However, this does not mean that home buyers should procrastinate. If you find a house you love, put in your bid and negotiate. Don’t provide an opportunity for another buyer to make an offer.

Watch Mortgage Rates. Currently, mortgage rates are still near historic lows. This presents a strong opportunity to enter the real estate market, particularly for first time home buyers who have no need to sell another home. Simple mortgage calculators widely available online can help you determine just how much you will pay per month based on a given interest rate. For example, a monthly payment on a 30-year fixed 5% mortgage rate on a $300,000 loan will be $1610.46.

Tax Credit Incentives. It may seem like a challenging time to enter the market. However, recently passed legislation that extends and expands the federal home buyer tax credit until April 30, 2010 can give potential and existing homeowners just the economic break they need. A first-time home buyer may qualify for up to the full $8,000 tax credit. A current homeowner may qualify for up to the full $6,500 tax credit.* For specific details please call one of our Realtors®.

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