Chandler, AZ – There is a lot of news coverage about home buying in 2009, especially in Arizona where home prices are way down due to the oversupply of vacant properties up for sale from foreclosures. Just about everyday when watching the news or reading news posts on the Internet there is some story about now being the perfect time to buy a house. Well, is it?
Here’s What So About The Real Estate Market That Makes It A Good Time To Buy:
- $8000 First Time Home Buyer Tax Credit – The $8000 first time home buyer tax credit is good for first time home buyers who buy a home in 2009 before 12/1/2009. This tax credit puts money directly into the first time buyers pocket, but only at tax time next year. More information on First Time Buyer Tax Credit. See below for explanation about tax credit bridge loan offered by State Housing Authorities, FHA lenders and HUD approved non profit housing agencies.
- Falling Home Prices – Just about everywhere you go in the US real estate values have been on the decline for nearly 2 years now. Who knows if home prices will continue to fall. They are back to levels lower than they were in 2003.
- Mortgage Interest Rates – Mortgage rates have been near record lows for most of 2009, and even with the slight increase in rates as of the beginning of June 2009, rates are still very attractive and low to make lower priced homes even more affordable.
- Abundant Inventory – With the huge housing market slowdown and decline in property values, there is a lot of inventory for a home buyer to choose from. In some cases there are great move in deals, and there are plenty of deals that require some home improvement work as they are a result of being vacant and on the market for some time. Home buyers can pick and choose to find just the right house for their needs and likes.
- Short Term Tax Credit Bridge Loan – This program is new as it has just recently been launched by HUD and FHA to provide a way for first time home buyers to use the $8000 home purchase tax credit when they buy their house instead of having to wait until tax time.
What you just read were some of the good reasons to buy a home in the current buyer’s market. Now we’re going to cover some of the reasons to consider not buying a home in the current state of affairs with the US economy and housing market.
- Job Certainty – many prospective home buyers are nervous about the job market and layoffs. No job is guaranteed right now and if you do loose your job, it is a tough getting a new job. So, many people do not want to take a chance with their finances until the job market brightens up.
- Housing Prices – some folks are still waiting to see what home prices are going to do. Many feel that home prices are going to continue to go down meaning that there are even greater deals to be gotten.
- Interest Rates – Similar to housing prices, are rates going to continue low or go even further?
- Less than perfect credit – gone are the days of buying a home if you have credit scores less than 620. While FHA and VA underwriting guidelines still allow for lower FICO scores, mortgage investors are not buying mortgages where scores are less than 620.
- Little to No Cash Reserve – with the slow down in the economy, many people just do not have money for the down payment and trying to save for a down payment is difficult.
With these reasons, buying a home might just be a fantasy and waiting it out a reality. If your credit scores are low – do some credit repair to improve your scores. If you do not have enough money for a down payment arrange for a gift from a relative, or see what your employer has to offer. Some employers have programs to help their employees buy homes – your may be one of them.
No matter what situation you are in buying a home in today’s economic environment does take some careful consideration and planning. You may consider a home buyer education course. If you are a first time home buyer, you may be required to take a course if you seek to use a first time buyer program or a down payment assistance program to buy your home. Be proactive and take a class ahead of time to prepare you in advance for the journey that lies ahead in buying a home. Good luck and happy house hunting.