Good News or Bad News?
The other day, I was manning our Prudential kiosk at the Tanforan mall, and a gentleman came up to me and asked how the real estate market is doing. I enthusiastically told him that our office has become quite busy lately and that we’re seeing a lot of activity, especially among first-time home buyers. His response surprised me.
He looked somewhat downcast and said, “Oh, that’s not good…” When I probed a little further, I found that his main reasoning was that he was hoping the housing prices would fall some more. If you’ve been keeping up with this company blog, you’ll have noticed that many of the topics have been about how the market has been picking up lately and even seeing multiple offers in many cases. For the sake of the economy and for homeowners, this is definitely good news. But I can see how a buyer who’s hoping to get a house at “the bottom” might not see it as such. To such people I say, “Why wait any longer?” Home prices are at such affordable levels that even if they drop a little more in the short term, you’ll have paid a fantastic price for owning your own home in the San Francisco Bay Area. Interest rates are at historical lows, and there are great incentives, like the $8000 tax credit, for first-time home buyers, as well as the greater availability of FHA and VA loans. If you’re not sure whether you can afford a home right now, speak to a loan agent or mortgage broker to see what your options are. Don’t miss out!
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8 Responses to “Good News or Bad News?”
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Hi Jean,
It is almost impossible to time “the bottom”, from my research it looks like it has already passed us. Like you I ask people, why not buy now? It is a great time to buy, there are many opportunties out there. What is important is that a buyer finds a house that they like, fits their needs, and payments that they are comfortable with. I believe it is better to make a decision now, knowing what you will get. Rather than waiting, not knowing if it will be too late and possibly get priced out of the market.
Potential Buyers are more interested in price than the combination of today’s low prices and today’s record low interest rates as you state. I try to explain to buyers that if interest rates go up just 1% and prices come down 10% it will still cost them more money and they may not even get approved. Sometimes I feel like shaking these people. (oops, maybe I should not say that)
Jean you are so correct, and Adam too, the bottom is impossible to time, but the interest rates and the tax credits are real and won’t be here forever.All we can do is keep sharing the information with everyone who will listen. Hopefully there are folks who just need to know a bit more to help them make a decision.
You all mentioned it, it is impossible to time bottoms or peaks. Potential home buyers should look at the big picture which includes all the current incentives that are TEMPORARY and will not be available for long time. What an agent should identify is “what holds a prospect homebuyer from buying now?”, cause with this information the Realtor can eliminate the fear factor of the home buyer.
Jean,
People are interesting!
We need to remind people that the benefits of home ownership such as tax deductions, security etc. are so important.
There is no way to judge a bottom, but buyers should focus on monthly costs after tax benefits vs. renting and all the money they will be saving.
Brian
It’s hard to convince people that conditions are constantly changing, both the market and them personally. People need to make decisions based on what is best for them, when it’s best for them.
The signs are definately there that the market is changing. Great post.
Larry
Hi Jean,
Well said. I agree with you, now is a great time to be a buyer or investor. Prices are low, and so are interest rates. I really liked your blog.
Jonathan