Is this a good time to buy a house? The answer is a resounding absolutely definitely YES!

Is this a good time to buy a house? The answer is a resounding absolutely definitely YES!

Here are the reasons – speaking as a consumer advocate/investor (I am looking for deals like crazy)

1. We always want to buy low/sell high in any investment, whether it is stocks or real estate. This is low! In some areas it’s a 20 year low.
2. Rates are dropping (finally). As rates continue to drop, those who qualify (tighter lending standards are a good thing... it means there’s a very good chance you will be able to afford the house you are approved for) will find it even less expensive to buy the house of their dreams.
3. Foreclosures, while bad for home values, are a great investment. Buying homes in pre foreclosure, saving the homeowner from a foreclosure on their credit record and getting a good deal.
4. The baby boomers that will be moving to Sun Belt states in the next 2 to 15 years will help the markets bounce back in these areas that were pummeled by low housing prices.
5. This is a good time to buy a short sale or REO property. The prices are low; the banks are really trying to keep foreclosures off of their books.
6. This can be a good alternative to stocks, particularly if you get positive cash flow.
7. Home builders are giving away upgrades; and in some areas nearly giving away the farm, too.

Now.. it is absolutely critical that people evaluate several areas before buying. Do your homework!

1. The overall trend in the area they’re buying in. Is it still going drastically downward? Is the national average a 4% loss and the loss in the area they want to buy 30%? A red flag.
2. Are there a lot of people in foreclosure in the area? Is the area in the top 50 metro areas? If so it’s a sign prices may drop further, and you should wait a bit longer before buying.
3. Is there high crime or low crime? Lower obviously is better. Higher crime leads to people moving away, and well.. criminals moving in.
4. Decent schools? This is always a good selling point if you need to get out quickly.
5. Can you afford it??? Don’t overbuy!
6. Finally.. are jobs moving TO or FROM the area? Moving from is a bad sign (e.g. the rust belt states.. Michigan, Ohio etc..) moving to? Round Rock/Austin Texas, Las Vegas.. good deals. Jobs will ultimately support the market!

With good decisions and proper research, it’s a FANTASTIC time to buy.

Dani Babb, PhD, MBA