This article discusses whether or not now is a good time to buy a home. Housing prices have declined over 33 percent in the past few years. However, housing prices could drop an additional 15 percent. It is very difficult to predict the housing market, and this article advises that a better thing to do is bet on interest rates. It is most likely that interest rates have bottomed out. So, based on interest rates, now is the right time to buy, regardless of whether home prices have bottomed out yet or not.
I think this is an tough question many americans are dealing with right now. Although it seems like a very attractive time to purchase a house, I think consumers are still extremly skeptical about purchasing a house. Houses are much cheaper now than in previous years, but it is hard to make that big of an investment knowing that the housing market could still be on the decline. Even a couple percent could mean the loss of thousands of dollars.
ReplyDeleteI agree with both Nathan and Hayley. It is a challenging question many people are facing. Is now a good time to buy or should we wait for further drop in prices. On the other end of things many people are waiting to sell their old home and wanting to buy another home on the low end, but in the end buying houses right now because the prices are so low, even though there is a chance they could go down more.
ReplyDeleteI think the housing prices might take the pattern of a J-curve where the prices will fall further on, before they start to improve. This is because it will take time for the economy to recover from the recession.
ReplyDeleteThis article is correct in saying that instead of looking at low or high prices people should be counting on whether money becomes cheaper and how much house you can buy. The article also states that important indicators include: the ratio of median income to median home prices, the cost of ownership versus renting, and the value of the national housing stock as a percentage of gross domestic product. These are important since many people buy houses for the wrong reasons, which include supposed tax breaks or as good investment. People often don’t factor in maintenance costs, property taxes, the opportunity cost of the mortgage down payment and also the amount that would have been saving from just renting.
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