Many in real estate are reluctant to call the bottom. A few quick clicks up in any recent statistics with any positive news... seems the be held up as a sign that things have turned around and things will soon be OK. However the news and statistics these days are like a tug-of-war! Each new news story pulls our minds in different directions. The problem is... that within a day some other news will come out that will dash or contradict that original news story. Now do you know why there is reluctance to buy?
So here are my thoughts... We are in the bottoming stage right now. The market is approaching bottom and will reach it no later than the first quarter of next year. The reason is that mortgage rates are at their absolute lowest, and will start to rise dramatically off their lows after the first quarter. So yes, home price will decline further, but the bottom is in the cost to carry the property. The monthly costs right now are so low that it is cheaper to own a home than to rent! The time to buy is right now! Some people will look for home prices as their gauge, I do not. I look at the cost to carry the home. Would you rather own a 200K home with a 4.5% 30 year fixed mortgage or 180K home with a 15% mortgage? I'd take the 200K at 4.5%! Do the math!
****A 70K mortgage at 15.5% PITI will be over 1500 a month! Been there, done that!
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