Should I FINALLY Get Off The Fence?
So Mr. and Mrs. Potential Buyer saunter up to me at a gathering and start up the usual patter about the real estate market.
“How’s The Market?”
“Really, I thought it was still awful.”
“Not since a year ago January. It slowed in the fall due to the elections but has picked up at the start of the year.”
“Really????? But it’s still a buyers’ market right?”
“No, not really. Things are looking better for sellers in many markets right now. As a matter of fact, listings are at an eleven year low and don’t seem to be picking up at the moment, so supply is really in demand.”
“So you think we should wait for a bit.”
“I didn’t say that. I said there is a low supply of inventory and there is an increasing demand by qualified buyers for good homes. If you are thinking about buying a home and are ready to do so, many factors are still in your favor. The cost of a mortgage is still at historically low levels so your purchasing power is greater than it has been for quite some time. Also home prices are still below the levels they were at five to eight years ago so there is still value out there. But things are changing.”
“Well as I stated earlier the supply of available homes is very low so there is a pool of buyers who have yet to find the right home waiting for the next new listing to appear. This has increased competition for fewer and fewer homes. Any home in good condition and appropriately priced will have many people look at it and the chances for a sale in a quick time and a good price are good. We have seen many instances of multiple offers.”
“So we can’t just keep on looking and return to a home we liked a week later and expect to have it still there?”
“No, you can’t expect that. Nor can you expect to write any old number on an offer and expect to have it accepted. Prices have stabilized and the options for sellers have increased.”
"But you think we shouldn’t keep waiting like we have been for the past five years?”
“No I don’t you should and here is why. The cost of a loan will eventually rise. And that "eventually" is getting nearer and nearer. The continued quantitative easing policies will come to an end. When that does you will see the cost of mortgages rise. An example, at 3.75% a $100,000 loan monthly payment for principle and interest is $463. At 4.75% that cost goes up to $521. This oftentimes lowers the cost of what you may purchase. As that does your buying power lowers.”
“Wait, there’s more. Prices have stabilized and in many cases are rising. This trend may not continue, but if inventory remains low the prices of available homes will rise.”
“Oh. So you think we should buy?”
“If you are ready to buy, and qualified to buy, I really do. I do not see any advantage for waiting. But remember you have to be ready to do this not just jump in willy-nilly.”
There will be a seminar for potential home sellers next Thursday at Jammy Buggars from 7 to 8 p.m. To register or ask questions email email@example.com.
Eric Lowrey is a Realtor working with Prudential Lucien. His wife Cindy and he have lived in Lakewood since 2004. As a former high-end Pastry Chef and College Teacher, he has lived many lives. Both Cindy and he are involved with Lakewood Alive, Live Well Lakewood and The Lakewood Historical Society. They live on Waterbury road with two cats and you can usually find them sitting on their front poarch come evening.
I am a Realtor working with Prudential Lucien. My wife Cindy and I have lived in Lakewood since 2004. As aformer high-end Pastry Chef and College Teacher, I have lived many lives. Both Cindy and I are involved with Lakewood Alive, Live Well Lakewood and The Lakewood Historical Society. We live on Waterbury road with two cats and you can usually find us sitting on our front poarch come evening.