As I have mentioned before, Linda and I are planning on buying a house later this year and we recently began looking at houses. Interestingly, when we got married almost 4 years ago I really, really, really wanted to buy a house, but the more I prayed about it, the more I felt like the timing wasn’t right for me. I remember being very frustrated and asking God “why?”. I didn’t get an answer then, but it is starting to make a bit more sense.
Suddenly just a few years later many more houses fall into our price range that didn’t before. I am now so thankful that we didn’t buy at the peak of the market, but are going to become first time home owners in the midst of a valley. As the old adage goes “buy low, sell high.” Thankfully God is smarter than me and helps me out even when I don’t realize I am being helped…
A perfect storm
I don’t know what’s going to happen the next few years, hopefully we will see a lot of economic recovery in the US. But even if we don’t, 2009 looks like it is shaping up to be a great year to become a home-owner. Here are a few of the reasons that I am glad we are going to be buying this year…
$8000 tax credit for home buyers – This is a nice incentive for all of us apartment-dwellers. And actually you qualify as a first-timer if you haven’t owned a home in the last 3-years. In order to qualify we have to close on your house by November 30th, 2009.
Interest Rates are very low – If you look at the historical data about interest rates you will see how low rates are.
Home Prices are low – I have watched some of my mutual funds’ values get cut in half, so I can imagine how some home-owners might feel who bought a home a few years ago, only to have it go down in value. Especially when some of the talking heads were basically saying that you could never lose money in real estate. But either way, real estate is still a good investment – but it is nice when you get it on sale.
Lots of bank-owned properties available – With the increase in people walking away from their mortgages and all the other negative effects of the credit crisis the banks own a lot of properties right now. Most banks don’t want to be in the real estate business, so bargains can be found.
Have we hit the bottom yet?
I was having a discussion with a reader (Randy) on Twitter (Follow CPF) about whether we have hit bottom yet. Personally, I think if we haven’t we are getting pretty close – at least in the housing market. But either way, while I am all for buying at the prime times, even Warren Buffett says that you should buy when you know it is a good investment – rather than waiting around the price to be perfect.
What do you think? Are you going to become a first-time home-owner this year?