Home prices remain depressed in some areas of the country, but for other areas prices continue to rise. This good news/bad news scenario can be different for buyers or sellers from market to market.
Talk of a $700 billion federal bail out; the collapse of Washington Mutual, Wachovia, and Merrill Lynch; as well as uncertainty about the coming presidential election has cast a gloomy cloud over the housing market. But, for people who are qualified to get a home today, the best deals can be had possibly making the fourth quarter of 2008 to be the best time to buy a home in a long time.
Are You Mortgage Qualified?
The key, of course, is being qualified. Unlike just a few years back when mortgage lending rules were relaxed to let hundreds of thousands of people buy homes who would never had been qualified under today’s rules, the mortgage market is actually quite good for today’s buyers. Consider the following:
Mortgage Rates — Lo and behold, mortgage rates are still quite good. A 30-year fixed rate mortgage can be had for just under 6% while jumbo mortgages are going for around 7.25%. This means that if you’re in the market for a modest home, you’ll find the best rates provided you have a sizable amount of money to put down and your credit is very good.
Weak Housing Market — You’ll want to steer clear of neighborhoods where foreclosed homes are dominant, but don’t be afraid to pluck a distressed sale from a better neighborhood where few homes are being offered for sale. Make your move quickly because savvy investors are smelling an opportunity and although they may be thinking about flipping, they still have to consider whether the market will rebound in the next few months to consider making an investment now.
At Or Near Bottom — Double digit drops in housing values over the summer and additional drops this fall are indicating that the bottom of the market may be near. Unfortunately, no one knows when the bottom has been reached, but if home values are off by 20% or more in your area, do you think that a downward spiral will continue?
If you plan on looking for a home this fall, get your financing lined up in advance. That way, when you find a home, you can show wary sellers that you are mortgage qualified and ready to negotiate seriously and follow through on your offer. Check out some smart money tips before you jump in too.
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