First Time Home Buyer – Fence Sitting – Think About It
May 30th, 2009 | 
Author: I recently wrote an article about the top ten reasons to become an Oregon first time home buyer and I haven’t changed my mind about the reasons that it is a good idea to buy your first home in this market. With the real estate market the way it is, it is almost a fiscal mistake not to buy a home if you are capable. Real Estate year over year has been a outstanding investment while also performing its primary duty of offering shelter to the home buyer. Combine that with the $8,000 First Time Home Buyer tax credit and it really is a great buying season.
Home values had risen to the point that some people were priced out of the market before the market suddenly took the current swan dive. That swan dive hurt a number of people but as the saying goes, “It is an ill will that blows no one good.” And, that has happened. With the drop in home values, a number of people that were priced out of the real estate market are now back into it with the help of low interest rates.
How long that either low home prices or low interest rates will last is a real question. Real estate values will start back up as the existing inventory is bought, and it will, just as it has in the past. Interest rates will go up as demand and bond prices bring them up. Either one could happen with short notice, although the evaporation of the existing inventory of homes will be the easiest to see coming. Interest rates could rise quickly, as they did last week when a spike in the bond market pumped 30 year fixed rates 1/2 percent in a three day period. That may or may not keep up, indications are that it won’t with a lowering on Friday.
Whenever someone wants to know when we will hit the bottom of interest rates or home prices, I can only tell them the bottom is only visible on the way up, not on the way down. If you are capable and waiting to buy a home, think very seriously about making the plunge and doing it now. If you are not capable, then you should meet with a professional like me and find out what you need to do to become capable of purchasing your first home. It may be easier than you think. Contact me at 541-342-7576/541-221-3455 cell or e-mail at eugeneloanguy@gmail.com. I am here to help work through the home purchase process.
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Fred, I have really never understood fence sitters when it comes to buying the home of your dreams. Could you imagine having to explain to your family that you lost the home of their dreams because you wanted to see if the price would drop another $5k?
Especially when you consider what the $5,000 costs them versus and additional 1/2 percent in interest rate. As an example, getting a loan for $200k at 5.5% vs a loan for $205k at 5% is a difference of just over $35 a month, in favor of the larger loan at the lower rate. Doesn’t make sense to wait, does it?